LG Display CEO Han Sang-beom, who is also the chairman of the Korea Display Industry Association (KDIA), talks about its updated business strategies during this year's IFA technology fair in Berlin, Germany, in September. / Korea Times file
Market leader LG asks Seoul to provide more favors
By Kim Yoo-chul
The government plans to expand tax benefits, tariff cuts and various kinds of administrative support to LG in an attempt to expand the country's footprint in the organic light-emitting diode (OLED) industry.
"Korea's longtime leadership in displays is increasingly challenged as Chinese and Japanese competitors are quickly narrowing the gap with Korean companies with massive investments in displays," said Minister of Trade and Energy Yoon Sang-jick at an event at the JW Marriott Hotel in southern Seoul, Friday. "We need to think how to keep the country competitive in the industry."
Yoon referred to China's recent approval for BOE to invest in super-sized OLED displays using advanced 10.5-generation glass-cutting technology and the launch of JOLED in Japan.
He told participants that the country plans to offer more financial benefits such as tax exemptions to companies focusing on OLED projects.
"With a combined global share of 42.8 percent, the country is still leading the industry. But the issue is that the market has already been crowded due to weak demand and continued oversupply," said the minister.
Korea has designated OLEDs as one of the next-generation key items.
Yoon urged closer collaboration between LG Display and Samsung Display to create an OLED ecosystem from components, materials and equipment to finished goods.
However, the minister declined comment when asked whether either LG Display or Samsung Display submitted proposals to the ministry for approval to proceed with plans to build new OLED factories in Korea.
Business not as usual
At the event, LG Display CEO Han Sang-beom, who is also the chairman of the Korea Display Industry Association (KDIA), said the global display leader expects another tough year in 2016.
"As the minister mentioned, Korea's display industry may suffer from profit decline next year due to various external factors. Such factors have yet to be factored in. Yes, the industry needs to get support from the government and companies should focus on finding their next revenue sources, and I believe OLEDs are promising."
He said the LG Group's display affiliate has been focusing on innovations in terms of technological advancements to cater to the specific needs of several industries and to increase market share.
OLED has been the emerging technology as the display has no backlight; therefore, it can be bent, twisted and even folded.
Its rival Samsung Display is focusing on small-sized OLEDs as the TV leader Samsung Electronics has yet to start its OLED TV business, while all Samsung's Galaxy line of devices are using small OLEDs supplied by the display unit.
Han said LG Display has no option but to keep moving on its high-stake bet on large-sized OLEDs. The company has invited Vestel of Turkey and Panasonic of Japan to its OLED Alliance, which LG wants to ensure it continues to lead.
As a showcase to highlight its readiness for high-end OLED displays, LG Electronics, the biggest stakeholder in LG Display, plans to exhibit prototypes of rollable OLED TVs with a screen size ranging from 70 to 100 inches during next year's International Consumer Electronics Show (ICES) in Las Vegas in January.
LG Electronics will start mass producing rollable OLED TVs from next year.