Samsung is tipping hundreds of millions into the production of LG Display panels, the move which is supported by the South Korean Government is seen as the consolidation of the South Korean TV industry which is being challenged by Chinese manufacturers such as TCL.
In their latest deal Samsung has placed an order for over 750,000 panels, which will be used in their 2024 and 2025 TV’s.
Without the Samsung deal LG Display would be struggling with the business only recently returning to profitability after six consecutive quarterly losses.
Channel News understands that Samsung is committed to LG Display OLED technology for the next five years with the long-term deal believed to be for over five million panels over five years.
It’s also been revealed that LG is also manufacturing LCD panels for Samsung which will be used in their mid-market and value TV’s.
At CES it was revealed that the 42- and 48-inch Samsung S90D TV’s will only use standard OLED panels, while the 55- and 65-inch models will get QD-OLED panels.
Neither Samsung Australia nor LG Electronics in Australia have commented on the move to LG Display panels.
The consolidation of two arch enemy Companies comes after forecasts indicate that China’s OLED shipments for OLED panels will surpass South Korea’s by 2025 with smartphones currently making up the bulk of the numbers.
According to OLED Market Track” reports published by market research firm UBI Research the current market share of OLED shipments for South Korea and China stands at 57.6% and 42.4%, respectively.
However, by the end of 2024 the gap is expected to narrow to 53.0% for South Korea and 47.0% for China.
Without the support of Samsung LG Display’s OLED production would be in big trouble with losses set to continue.
By 2025, the numbers will shift to 45.2% for South Korea and 54.8% for China, with China taking the lead.
Furthermore, UBI Research predicts that by 2027 the gap will widen with South Korea holding 35.8% and China claiming 64.2% market share.
UBI Research stated, “South Korean display manufacturers produce high-quality OLEDs, ensuring a continued advantage in revenue. However, with immense domestic demand and government support, China’s display industry is improving its quality.” They further added that “after 2028, China might surpass South Korea in revenue.”
Observers believe that South Korea, the “absolute leader in displays,” might concede its leading position in OLED shipment numbers to China as early as 2026.
Industry experts believe China has a long way to go before overtaking South Korea in the short term.
High-value panels allow South Korean companies to maintain profitability despite selling fewer units.
The future of OLED competition might be in the hands of Apple in the smartphone market and Samsung in the TV market.
Samsung Display who manufactures OLED panels for Apple iPads and next year notebooks, dominant in the medium-sized OLED market.
Samsung plans to firmly establish itself in the 8.6-generation OLED market, starting with supplying screens for Apple’s iPads.
Samsung Display is also investing 4.1 trillion won to construct the world’s first 8.6-generation IT OLED production plant for smaller OLED panels which is where LG Display has struggled claim analysts.
In the vehicle OLED market, Samsung Display has been expanding collaborations with global brands like Ferrari, BMW, and Audi.
LG Display has a two-decade-long partnership with Mercedes-Benz, continually aiming for market expansion.
Experts stress the need to not only widen the OLED market gap but also prioritize the commercialization of next gen displays like Micro LEDs.
Samsung Electronics has launched a large Micro LED TV, capturing market interest, while LG Display is at the forefront, developing “stretchable” displays based on Micro LED technology.
