Sweta Dash, president of market research consultancy Dash-Insights, and writing in Display Daily, has said there is a “massive” amount of LCD capacity coming into production over the next 3 years, particularly from Chinese factories.
“There is a race for revenue and profit growth as competition is accelerating and price pressure is increasing,” she said, adding that new-generation fabrication plants can achieve eight 65” or six 75” panels from a single glass substrate, ensuring higher efficiency and thus lower costs.
Dash says that manufacturers such as BOE Display, China Star (CSOT) and Foxconn/Sharp are all boosting output over the next 18 months or so. “By the year 2021 and 2022 about eight to ten 10.5 Generation fabricators with huge capacity are expected to be in production. That will include LG Display’s 10-5 Gen oxide based AMOLED [plant].”
“Will there be enough demand for this huge capacity of 65-inch and higher size TV panels?” she asked.
“With the growth of massive capacity, the entrance of new panel suppliers and TV brands, competition is accelerating and price pressure is increasing. In the last few years a slower growth rate, higher capacity, over-supply and low open cell prices have already resulted in low profitability. A fear of panel oversupply is now looming large over future years. Over-supply could lead to faster price reductions,” she warned.
“Despite uncertainties, top brands are expecting demand for premium TV to grow including UHD, 8K and ultra large TV. Technologies such as 8K, OLED, Quantum Dot still carry premiums providing opportunities for higher revenue and profit.”