What is the future trend of Samsung/LGD switching OLED LCD panel?

Currently, the mainstream display technologies available in the market are LCD and OLED. Among these, OLED has gained significant traction due to its wide color gamut, near-infinite contrast ratio, extremely fast response time, flexibility, and energy efficiency. With strong demand for OLED screens, companies like LGD are accelerating the phase-out of LCD panels, signaling a clear shift toward OLED technology. It’s evident that the competition between LCD and OLED will eventually come to an end as the industry moves forward.

LG's Decision to Exit Small and Medium-Sized LCD Panels

According to the Korea Business Daily, LG recently shut down its fifth-generation P4 plant in Gumi, following the closure of its third-generation P2 plant. It is expected that the fourth-generation P3 plant will also be closed by the end of the year. This move reflects LGD’s strategic shift towards OLED production, despite not officially announcing the closures.

Although LGD hasn’t publicly confirmed any factory closures, industry observers believe that the company is gradually transitioning its existing facilities to OLED production. LGD currently operates eight-generation LCD plants (P8, P9) and has introduced various differentiated products, such as ultra-large UHD TV panels. The company plans to invest 20 trillion won (about $18.08 billion) in the OLED industry by 2020, with new factories set up in Paju, Gumi, and Guangzhou, China.

In July this year, LGD announced the construction of a new OLED panel joint venture factory in Guangzhou, marking its first large-scale OLED facility in China. The project, costing around 180 billion yen, is expected to resolve issues related to cost and capacity over time.

Samsung, another major player, has also been closing several LCD lines, including a seventh-generation factory and two fifth-generation ones. In 2017 alone, Samsung invested $8.8 billion to expand OLED production and convert some LCD factories into organic screen facilities.

It’s clear that Korean manufacturers are accelerating their transition from LCD to OLED, leading to a tighter supply of small-sized LCD panels, especially for mobile devices.

Taiwan's Panel Makers Seize New Opportunities

While OLED is the future, it can't fully replace LCD in the short term. As Korean manufacturers adjust their capacities, there's a growing opportunity for other panel makers, particularly in Taiwan. After Samsung closed its seven-generation factory, it caused a shortage of 40-inch TV panels. Similarly, LGD’s closures are likely to reshape the market, creating space for mainland and Taiwanese manufacturers.

Mainland companies like BOE mainly focus on 8.5-generation lines for 55-inch TVs, while Taiwanese firms such as AUO, Innolux, Caijing, and Huaying continue to produce smaller panels. This situation presents opportunities for them to gain more market share and influence.

To stay competitive, panel makers must seize these opportunities, collaborate with more manufacturers, and keep up with the latest technologies. Staying ahead of the curve is essential to avoid being left behind in the evolving market.

Short-Term Benefits for LCD, Long-Term Uncertainty

With the rise of smart technology, LCDs are still in demand for automotive displays, industrial applications, and medical equipment. These sectors are becoming key growth areas for the LCD market. In the near future, LCD modules may still offer good profitability.

LCD technology has also evolved, offering wide color gamuts and stable performance at low power consumption. While OLED is gaining ground, LCDs remain competitive in many areas, especially in large-screen TVs where OLED production is limited and costly.

Industry experts predict that LCD TVs could have a commercial life of 5–10 years. Many Chinese LCD manufacturers are still optimistic about large-size LCDs and are investing in new production lines. This suggests that LCDs will continue to play a role in the market for some time.

However, the next 5–10 years may bring a deep transformation in display technology. While OLED is advancing rapidly, it still needs content support to fully take over the market. According to a 2018 report, global LCD production reached $5.092 billion in 2017, but the LED display market saw slower growth due to economic factors.

The Industrial Technology Research Institute (ITRI) forecasts a modest annual growth rate of -1.7% to 1.0% for Taiwan’s panel industry. Positive trends include a stable economy in Europe and the U.S., which could boost demand. ITRI recommends focusing on niche markets like public displays, automotive panels, and e-sports screens to maintain profitability.