Reason behind Six months early closer of Samsung’s LCD Production Business

Samsung’s display-making division, originally announced that its LCD operation would be phased down by the end of 2020. After the demand for LCD panels grew in the post-pandemic (Covid-19) period, the corporation was forced to reconsider. More claims surfaced in 2021 claiming that the corporation has intended to discontinue producing LCD panels once more, but it did not.

However, according to a Sammobile report, its Display is finally ready to stop producing LCDs. According to the report, it is now purchasing LCD panels from China.

Transition to OLED:

According to the source, they may be intending to stop producing LCD panels in June since it does not align with Samsung Display’s long-term commercial goals. Because it is currently rebuilding an old LCD facility to make OLED panels, the company wants to emulate LCD panels with Quantum Dot (QD-OLED) displays.

The corporation does not want to compete in a market dominated by low-cost panels from Chinese and Taiwanese competitors. The article alleges that declining LCD prices are also preventing them from maintaining production.

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Samsung Electronics, the conglomerate’s consumer electronics division, was Samsung Display’s biggest buyer. The corporation, on the other hand, prefers low-cost LCD panels from Chinese and Taiwanese manufacturers. After its LCD division shuts down, Samsung Display is expected to focus solely on Quantum Dot and OLED panels. Workers assigned to LCD production will most likely be reassigned to the QD division as well.

According to Display Supply Chain Consultants, the price of an LCD is 36.6 percent lower than it was in January 2014, when the component was at its peak manufacturing. This is due in large part to manufacturers such as BOE from China and AU Optronics from Taiwan joining the fight and offering lower pricing to customers.

Reason for Early Closer of Production:

Samsung Display will discontinue producing LCD screens just at end of June, six months ahead of schedule. According to GSM Arena, Samsung had planned to liquidate its LCD business in 2020, but due to COVID and the need for lower-cost home media devices (including low-cost mobile phones and tablets), the company decided to postpone this big step.

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We were unable to reach out to company representatives for comment, and we currently have no knowledge of the capital plan’s specifics. We’ll learn more after the second quarter ends and quarterly earnings are released in late July.

According to a forecast by Display Supply Chain Consultants (DSCC), a US industry research group, the average price index of LCD panels will decline to 36.6 in September this year, compared to 100 in January 2014. The figure is now 58 percent lower than the previous high of 87 in June 2021, which was set at 41.5 in April of this year.

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