According to the Nihon Keizai Shimbun, Chinese companies have begun to focus on large-scale investments in the field of OLED panels used in smartphones. Six major Chinese companies, including BOE, have successively established new factories. It is estimated that by 2020, the total investment is expected to exceed 2 trillion yen (about RMB 124 billion).
According to the report, Chinese companies have used large-scale financial assistance from local governments to implement large-scale investment in OLED panels and increase their competitiveness against Korean manufacturers.
Further analysis in the report indicates that in the field of display devices used in smartphones and televisions, Japanese companies have been one step ahead in the accumulation of basic technologies, both in the current mainstream TFT-LCD and in the new generation of organic OLEDs. However, after the 2000s, Korean manufacturers mastered the dominance of liquid crystal mass production, and the global market for OLEDs for smart phones is now almost monopolized by Samsung Electronics of South Korea.
However, on the one hand, Chinese companies continue to increase investment in the field of LCD panels. It is expected that by 2018, they will surpass South Korea in the production capacity rankings of the countries and take the world's first throne. Not only that, but Chinese companies are also extending their business to the field of OLED panels, which makes the layout of cutting-edge electronic components in Chinese companies more and more clear.
At this stage, China's largest panel maker, BOE Technology, is building an OLED panel factory in Chengdu, Sichuan, which will have the equivalent capacity of 10 million smartphone panels per month. The investment will exceed 500 billion yen (about RMB 31 billion). The plant will be put into production in stages, and mass production will begin in 2019. As for, Huaxing Optoelectronics (CSOT) is also building a factory of the same size in Wuhan, Hubei.
As Apple has revealed to customers, some of the new iPhones in 2017 are going to adopt OLED plans. Therefore, BOE and Huaxing Optoelectronics decided to implement a large investment, which is believed to have been affected by this news. The two companies have concluded that Huawei smartphones and other Chinese smartphone manufacturers will also adopt OLEDs, which will increase demand.
Compared to TFT-LCDs, OLEDs can produce vivid colors and can be bent. Therefore, it provides greater freedom for design. Smartphone manufacturers believe that this is conducive to the development of a new generation of products, began to gradually adopt OLED, and panel manufacturers are also stepping up supply.
In addition, the layout of China Tianma Microelectronics Group changed the TFT-LCD factory built in Wuhan to a special OLED factory. Companies such as Hehui Optoelectronics and Visionox Display Technology also plan to build new plants. As for the new ventures such as Rouyu Technology, it has made investment decisions of more than 300 billion yen (about RMB 18.6 billion) with the help of local government funds.
In the future, if Chinese companies start production as planned, the global shipments of smartphones will be converted to meet the demand of more than 30% of the market. However, OLED production technology is more difficult. Even Samsung, which produces about 300 million smartphones a year, is also worried about improving the yield. Therefore, a large increase in production may lead to a fall in market prices, coupled with difficulties in improving yields, and will also increase costs, which will also cause Chinese related companies to face the risk of deteriorating operating conditions.
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