As one of the world's technology giants, who doesn't know Samsung Electronics? This South Korean technology company has produced various technologies. One of them is a liquid crystal display (LCD) panel for televisions, computers/laptops, cellphones, and tablets.
Despite having a reputation in the field of LCD production, Samsung finally declared to stop producing LCDs by 2022. It has been warned since 2 years ago, what finally made Samsung stop making LCDs?
1. The economy is starting to stabilize, LCD is languishing
Reported by The Korea Times on May 30, 2022, Samsung Display has actually stated that it will stop producing LCDs since 2020. However, due to the increasing demand for LCDs amid the COVID-19 pandemic, Samsung Display decided to continue producing LCDs at the request of Samsung Electronics.
However, according to the US market analyzer firm, Display Supply Chain Consultants (DSCC), LCD prices fell again in 2022. In April 2022, the LCD price index was seen in the range of 41.5 percent, down 58 percent from June 2021. This index is projected to fall to 36.6 in September 2022.
2. Inferior to the "neighbor's kitchen"
In addition to not making a profit anymore, it is known that Samsung Display LCD production is no longer what Samsung Electronics sees. The Korea Times said for LCD panels, Samsung Electronics has cooperated with two companies from China and Taiwan, namely:
- BOE Technology Group (Chinese manufacturer of electronic components)
- AU Optronics/AUO Corp (Taiwanese LCD manufacturer)
It is known that both manufacturers produce LCDs at a lower price than Samsung Displays. Because of this, the position of the LCD on the Samsung Display is languishing even more.
3. Concentrate to OLED and QD
Since its establishment in 1991 as a subsidiary of Samsung and an LCD manufacturer, Samsung Display has then combined with three local companies and a Japanese company producing organic light-emitting diodes (AMOLED) to produce more advanced displays.
Initially at the end of 2022, the samsung display decision came 6 months ahead of forecast. While no longer producing LCDs for TVs, Samsung Display will focus on the production of organic light-emitting diodes (OLEDs) and quantum dots (QDs). Samsung Display will transfer employees from LCD production to QD.
4. LG said goodbye?
Before Samsung Display, The Korean Economic Daily also reported that in early May 2022, LG Display will also stop LCD production and focus on OLED production, where South Korea is more reliable. While planning to stop LCD inputs by up to 10 percent, LG Display does not stop completely from the LCD industry.
Another reason is similar: LG Display claims to be less competitive than Chinese LCD manufacturers, BOE Technology Group and China Star Optoelectronics Technology (CSOT). Although it promises not to leave the LCD industry, with the position of LCD from South Korea increasingly cornered, LG Display is also predicted to codify Samsung Display.
On the other hand, when it comes to OLED, LG Display wins because it holds 99.7 percent of the OLED market, while Samsung Display is the remaining 0.3 percent. In May 2021, Samsung Display promised to invest US$2.7 billion (nearly IDR 40 trillion) to boost OLED production for HP and laptops.