Samsung Display considers continued production of LCD panels due to surging demand
Samsung Display's plant in Asan, South Chungcheong Province / Courtesy of Samsung Display
By Baek Byung-yeul
Samsung Display plans to extend production of liquid crystal display (LCD) panels until 2022, due to increasing panel prices and demand, the display-making arm of Samsung Electronics said Friday.
The display maker said its CEO, Choi Joo-sun, recently told employees in an email that it is reviewing whether to keep producing LCD panels until the end of next year.
The CEO's email came at a time when LCD panel prices have continued to rise, due to surging demand for IT devices and TV sets since the start of the COVID-19 pandemic, compounded by a supply shortage of core components for TVs. Market tracker Witsview said that the average LCD panel price in the first half of May rose to its highest level since June 2015.
A company official said that the CEO sent the e-mail on May 25 and confirmed that the display maker is considering extending the production of LCD panels. “We are considering continuing LCD production until next year, while taking into account the factors that affect the best interests of the company and market conditions,” the official said.
As Chinese rivals flood the market with cheaper LCD panels, Samsung Display announced it will exit the saturated market in 2020 to transform its production line to quantum dot light-emitting display (LED) panels, which are considered to be the next-generation in technology for displays.
However, at the end of last year, Samsung Display changed its strategy and decided to continue LCD production. Industry officials said the company decided to continue producing LCD panels after a request from Samsung Electronics, which wanted to secure a stable supply of LCDs and manufacture LCD-oriented TVs with affordable price tags.
LG Display is also slowing down its plan to phase out the conventional LCD business, due to the increasing panel price. Jung Won-seok, an analyst at Hi Investment & Securities, said the price of LCD TV panels rose 13 percent in the first quarter of this year from the previous three-month period, and projected the price to rise about 15 percent more in the second quarter.