Samsung Display and LG Display Postpone Their Plans of Shutting Down Old LCD Lines

Apr 14, 2017

Samsung Display and LG Display are tentatively postponing their plans of stopping old low-generation LCD production lines due to shortage of supply of LCDs for large TV panels and panels for IT products. They have also put off their plans of changing old LCD production lines into OLED production lines.
According to an industry on the 13th, LG Display and Samsung Display have decided to tentatively postpone their plans of stopping LCD production lines that are under 6th generation and focus on producing LCD panels.
LG Display has decided to postpone its plan of stopping 3.5th generation (P2), 4th generation (P3), and 5th generation (P4) production lines, which are located in Gumi. Schedule for a plan of stopping production lines at the end of last year that has been postponed to first half of this year has been postponed once again. Since immediate supply and demand of LCD panels is difficult, it is planning to focus on mass-producing LCD panels by utilizing current facilities at maximum. However it is currently changing its 5th generation P5 Line into OLED production line for lights.
“Although we predicted that shortage in supply of LCD panels will become better during second quarter, supply and demand is still tight just like it was in first quarter.” said a representative for LG Display. “Because this situation is lasting more than we expected, we are currently focusing on producing LCD panels as of now.”

Panoramic view of LG Display’s facilities in Gumi (Picture = LG Display) <Panoramic view of LG Display’s facilities in Gumi (Picture = LG Display)>

It was heard that Samsung Display will stop operating 6th generation L6 Line and L6 Wing Line after stopping operation of 7th generation (L7-1) line at the end of last year. Possibility of stoppage of 7th generation L7-2 Line was also brought up. It was also seen that companies started pulling out large equipment and selling them after grouping equipment as scrap metal.
However because there was disruption with supply and demand of large LCD panels as Sharp stopped supplying panels to Samsung Electronics VD Business Department, it is heard that Samsung Display has practically cancelled its plan of stopping old LCD lines which was examined from medium and long-term. It will be even more difficult for Samsung Electronics to secure LCD panels for TVs if it stops operating 7th generation lines.
“There was a high chance that Samsung Display will stop operation of old LCD lines as it was looking to stop operating 6th generation lines by end of this year or sell them to Chinese panel manufacturers.” said a representative for an industry. “Although it was still looking to stop operating old LCD lines even after Sharp stopped supplying its LCD panels, it has decided to postpone its medium and long-term plans all together as problems regarding supply and demand have become more serious.”
Market research company called IHS Market predicted that there is a high chance of stoppage of operation of old production lines as efficiency of production lines that are less than 4th generation has fallen significantly. It analyzed that there will be significant issues regarding lack of supply and demand as imbalance of supply and demand will close upon 10% if lines that are less than 5.5th generation stop operating.
“Because it is predicted that problems regarding supply and demand of LCD panels will ease up starting from second half of this year, plans regarding operation of old lines will fluidly change according to atmosphere within markets.” said a representative for an industry.
Staff Reporter Bae, Okjin | withok@etnews.com

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