Gen7, the world's largest panel production line, closed at the end of the year

Introduction: Periodic development is a common industry commonality, as is the panel industry. When production is insufficient, increasing production leads to overcapacity. After the production capacity was improved at the end of last year, due to the weak seasonal demand, the panel supply in the first quarter of 2016 was seriously oversupply, exceeding the demand by 20%. These phenomena led to overcapacity of the panel, which led to the closure of many panel makers. The production line. Subsequently, due to the impact of the season, the supply and demand situation began to tighten, and there is news that Korean panel makers will close the Gen5 or even Gen7 production line at the end of this year, further increasing the shortage of the panel market!

Global panel shortages have become the consensus in the industry, ranging from smart phone panels to large-sized TV panels, all of which are out of stock. For the panel shortage that has been going on for nearly half a year, the reasons for this must be everyone’s It is clear that, in a nutshell, there are mainly the following reasons: 1. Due to the low profit, CPT has closed a 4.5-generation production line; 2. Due to the impact of the Tainan earthquake, the production capacity of Hancai and Innolux has been affected; BOE, AUO, and Innolux are now starting to make modules, not just making large boards as before, which extends the production cycle of the products; 4. The market exceeds the forecast; 5. Last year, panel makers will have capacity due to small-size panel losses. Transfer to large-size panels; 6, out of stock caused the phenomenon of roasted seeds and nuts more frequently further exacerbated out of stock!

Cyclical development is common to many industries, as is the panel industry. Insufficient supply has led to panel makers producing heavily, followed by severe overcapacity. On the eve of the shortage of the wheel panel, there was a serious overcapacity. In particular, the new capacity of the mainland was improved last year, but the market was in a state of seasonal weakness, which led to a serious supply of more than 20% of the panel supply in the first quarter of 2016. This is the most serious overcapacity since the beginning of 2012. Under the premise of overcapacity, many panel makers have closed production lines, such as CPT.

However, since the second quarter of 2016, the market has exceeded expectations, especially since the beginning of the second half of the year, which has led to a tight supply and demand situation, and Korean panel makers will close Gen5 or even Gen7 rise at the end of this year. This production line accounts for the global market. 4% of the size of the panel, resulting in panel makers can not meet the market demand growth of 5% -6%. Therefore, according to IHSMakit, market supply is expected to be further tightened in 2017, and the global display panel market continues to be in short supply. In other words, out of stock will continue to advance!

According to the latest IHSMarkit “Monitor Supply and Demand and Equipment Tracking”, large-size panel application demand is expected to increase by 5-6% annually in 2016-2018; however, large-size panel production capacity is expected to increase by only 1% in 2017 and 5 in 2018. %; By the second half of 2018, as China will have more capacity to launch, including the world's first Gen10.5 plant, the market is expected to be loose again.

According to IHSMarkit, the large-size panel shortage will continue until next year, and may not be alleviated next year. In this view, in the view of CPT personnel, the demand is verified from various aspects. First, the module factory has an overbooking panel. Secondly, whether the agent has the goods, if the agent has the goods, then it will be alleviated in November this year. If the agent does not stock up, it depends on the production capacity of the 8th and 10th generation production lines in the mainland. In addition, is there still a module to re-ship the BOE, if only the big board flowers are used as before, the panel will be relieved! And in the small-size panel, it depends on how the iPhone7 will be sold. If the iPhone 7 is not selling well, it will also ease the shortage of small-sized panels.

According to the author's contact with BOE, BOE is still doing module reshipment, because it can maximize the benefits! But if the module is re-shipped, it will be more complicated and will increase the production period of the product. . In addition, in the BOE staff, the other side also believes that the stock will be out of stock until next year, according to it: "The phenomenon of out of stock will continue until next year, the current eight generations of mainland China should be fully produced."

Previously, some people in the industry told the author that if you want to alleviate the shortage of small-sized panels, you should see if the panel makers will change the large-size panel lines into small-sized panel lines, but only if there is enough profit. However, from the current point of view, the size and size of the panel are out of stock, so the idea of ​​pinning your hopes on the large size panel may be lost!

However, according to Dongguan Guangzhi Optoelectronics, a small and medium-sized chemical film supplier, their products are mainly positioned in the mid-to-high-end market, but they have not changed much in terms of their shipments. Group shipments have not changed much, and panel out-of-stocks should be mainly in the high-end and low-end markets.

It is worth mentioning that there are also OLEDs. Because LCD panels are in a competitive process of “price killing”, Korean panel makers have little advantage. On the other hand, they benefit from the advantages of OLED panels and Korean panel makers in OLED. In terms of advantages, OLEDs are gradually replacing LCDs under the promotion of Korean manufacturers, especially in smart phones and smart TVs. In terms of smart phones, Korean Samsung is the dominant factor, and in the case of large-size smart TVs, LGD is the dominant factor. Although both of them have invested a lot of money in the research and development and production of OLEDs, this is undeniable, but is it really investing as much as it is rumored by the outside world?

According to BOE personnel, "There is no denying that Samsung Display and LGD have invested a lot of money in OLED panels, but as far as we know, the funds they invested are not actually so much publicized. It is worth noting that LGD, in terms of large-size OLED panels, LGD can be said to have absolute technical and patent advantages. They did invest a lot of money, but they did not say so much to the outside world, although they did not say so to the outside world. Much, but still cause LGD to lose money, and LGD is also the company with the most losses in the field of OLED panels. In addition, from the aspect of performance, OLED applications in the large-size TV, it is difficult to see with the naked eye much better than the LCD, in the so-called There is not a lot of power saving in the province. For consumers, it is better to buy LCD TVs than to buy OLED TVs with much more money than LCD TVs."

In PIDA's view, as the iPhone will switch to OLED (AMOLED) from next year, Korean panel makers Samsung Display and LGD have formed an insurmountable wall for other panel makers in the OLED field. In terms of mass production strength, Samsung Display and LGD are the most powerful. The former dominates the small and medium size and the latter dominates the large size. As for the impact of the current OLED development on domestic panel makers, in the eyes of individuals, the development of OLEDs may be a little slower, which may be a favorable thing for domestic panel makers, because in terms of technology and patents, Samsung Display and LGD Has an absolute advantage, especially in the upstream equipment, it is said that it is basically monopolized by Korean panel makers. This can be seen from the aspect of OLED yield, the development of mainland panels is not easy, and the development of OLEDs is too fast. For domestic panel makers, it can be said that the disadvantages are far greater than the benefits! From LCD to OLED, the buffer period for domestic panel makers is too short!

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