"In the field of liquid crystal display (LCD), Samsung and LG display have been defeated by China's low-cost offensive." Last September, South Korea's "Central Daily" reluctantly admitted. Now, the new coronavirus epidemic has "made up a knife".After LG display announced in January that it would close its LCD panel factory in South Korea by the end of this year, a spokesman for Samsung display said yesterday (March 31) that it had decided to stop all LCD panel production in South Korea and China by the end of this year.
According to the analysis of cinno research, an industry research organization, Samsung's early closing of the factory means that the global large-scale LCD panel will shift from the accelerated competition between China and South Korea to a dominant situation in China. Chinese manufacturers will account for more than 60% of the global LCD production lines of more than 7 generations.
Advance to the end of the year
According to reports, Li zarong, vice president of Samsung Electronics, made the decision after visiting the Samsung display factory.
On the same day, Cui Zhoushan, the business director of Samsung display large business department, sent a letter to all customers, saying that the company had major changes in its business strategy, because in recent years, the LCD market has been in a serious depression, and the operation of large business departments has a large-scale deficit. In order to get rid of the current business crisis and improve the competitiveness of large businesses, Samsung officially opened in October last year Started QD display investment.
It is worth mentioning that in August last year, observer.com reported that Samsung plans to shut down half of the LCD panel factories in South Korea due to the oversupply of the market.
At that time, Samsung display said in a statement: "due to oversupply and deteriorating profitability, Samsung display has been adjusting production and equipment operation. We have considered suspending the production line, but no decision has been made. "
According to Korean media EBN, Samsung will sell LCD production equipment of its Korean production line after closing its factory in advance. When it shut down part of the production capacity of l7-1 in 2016 and l8-1 in 2019, it sold some equipment to some manufacturers who want to enter the LCD industry quickly.
"But with industry expansion under pressure, Samsung may also find it difficult to find the right buyer to opt for direct disposal. The Suzhou factory is in good condition and may be sold to Chinese companies as a whole. noted in the above report.
According to qixinbao data, Suzhou Samsung Electronic LCD Technology Co., Ltd. holds 60%, 30% and 10% shares respectively by Samsung display, Suzhou Industrial Park state-owned assets holding Development Co., Ltd. and TCL Huaxing Photoelectric Technology Co., Ltd.
Actually, as early as September 2016, Samsung reached a cooperation with TCL on the 11th generation LCD. Samsung monitors invested 9.8 per cent in the 11th-generation panel producer set up by TCL group's Huaxing Optoelectronics and will accept the supply of 11th-generation panels.
It is worth noting that as early as last October, Samsung display announced that it had decided to close some LCD panel production lines in South Korea due to the decline in market demand for LCD and oversupply.
In January, Zheng haorong, President of LG display (LGD), another Korean display company, said in an interview that he would close the LCD panel factory in South Korea for LCD TV production by the end of this year.
So far, the two Korean panel companies will withdraw from the competition in LCD field.
China's mainland panel factory shipped a large number of new production lines in the 10.5 and 11 generation last year, causing panel prices to collapse and television panel prices to plummet by an average of 20-30 per cent throughout the year, the industry and commerce times reported on april 1. A total of 36.6 billion yuan (about 8.54 billion yuan) was lost in Taiwan's panel manufacturer Youda and Group Chuang throughout the year, LGD more than 18 billion yuan.
The coming of "China era"
According to the report of "cinno research", from the end of 2019 to February 2020, the price of large-size LCD panel had a trend of price recovery for several months. And after 2020, the early outbreak in China and South Korea made the industry worried that the LCD display supply gathered in the two countries would be seriously affected, so the downstream started the mode of hoarding.
However, the development of the global epidemic makes the supply chain have to make the fastest response decision. Since March, the epidemic situation in mainland China has been gradually controlled, and production has been resumed actively. South Korea has also taken very strict control measures, and panel supply has not been greatly affected.
However, the surge in the number of infected countries around the world, especially the rapid deterioration of the epidemic in Europe and the United States, exceeded expectations, resulting in the cancellation of many international events and exhibitions, the start of the closure of international routes in many countries, and the obstruction of international trade exchanges, side.
The above report shows that the reversal of supply and demand led to the fall in the price of large-size LCD panels in March, and with the development of the epidemic, the drop is expected to continue to expand, and the price of large-size LCD panels will be explored again. Samsung may decide to shut down LCD production ahead of time just because of this concern.
According to the report, samsung's early closure means that the world's large-size LCD panels will shift from faster competition between china and south korea to a dominant position in mainland china.
According to the forecast of South Korea semiconductor display society in March, the market share of Chinese enterprises in the global panel market will reach 58% in 2023, among which LCD panel will enter the "China era". It also predicts that by 2022, China will set up 19 large panel factories with 8-10.5 generation lines.
The share of large-size LCD panel shipments in mainland China has risen further as South Korean and Taiwan manufacturers sharply cut their rates or shut down some of their capacity starting in the fourth quarter of 2019, according to a new report from research LCD on 24 May.
It is worth noting that in the current month, Samsung's shipping volume share was 7%, lagging behind Huaxing potential's sixth, and its shipping area share was 12.0%, ranking fifth; LGD's shipping volume share was 14.1%, falling from the second in the same period last year to the third, and its shipping area share was 12.9%, also falling from the second to the third.