LG Display Making Necessary Preparations to Start Operating Its Guangzhou Fab at the End of This Month

Jan 17, 2020

It is understood that LG Display is planning to operate its 8.5-Gen OLED TV fab in Guangzhou on full-scale starting from end of this month. After improving an issue with manufacturing processes that had held LG Display back, LG Display is finally getting ready to produce OLED TV panels after five months removed from the completion. It is heard that the delay in operation of the fab has brought significant amount of burdens on LG Display’s performance.
According to the industry, LG Display has set an internal course of action in order to start operating its fab in Guangzhou at the end of this month.
“LG Display made requests to its main materials and components suppliers to prepare for supplies of their products.” said multiple representatives from the industry.
LG Display’s fab in Guangzhou was completed in August of last year in order to produce 55-inch, 65-inch, and 77-inch OLED TV panels. LG Display has shown its will to lead the large OLED TV panel market by producing up to 90,000 panels by end of this year.
However, there was a setback with production. Normal operation was delayed due to an issue with productivity. In addition, the fact that LCD prices plunged had put on even more pressure on LG Display.
Specific reason why there was a setback has not been confirmed. However, the industry points to the fact that LG Display introduced a new process that was not used before. The industry believes that the new process that was introduced to improve production capacity actually resulted in low production yield and a delay in operation.
It is heard that LG Display made a decision at the end of last year. It decided to remove the new process and apply technologies that are verified and have been used to its fab in Guangzhou.

LG Display’s 8.5-Gen OLED TV fab in Guangzhou <LG Display’s 8.5-Gen OLED TV fab in Guangzhou>

According to the industry, it is heard that LG Display achieved a significant improvement in production yield when it partially modified the device that is used at its fab in Paju and applied the modified device to its fab in Guangzhou instead of using the OLED panel device that it initially applied to its fab in Guangzhou.
“After changing materials and the formation of an OLED panel device, LG Display was able to achieve a level that it was satisfied with.” said a representative from a materials manufacturer that is familiar with LG Display’s situation.
As a result, LG Display is now able to make preparations to start producing OLED TV panels from its fab in Guangzhou. If there is not any setback, it is expected to maximize the production capacity of the fab as quickly as it can.
LG Display just survived a harsh winter. Due to poor performance, it even carried out a restructuring last year. Although it needs to break away from its LCD business due to fierce competitions with Chinese companies and increase production of OLED panels, a setback to its fab in Guangzhou, which is the key plant for its large OLED panel business, had made it even more difficult for LG Display.
Once it ships OLED panels after operating the Guangzhou fab on a normal operation, then it is able to work with Chinese TV companies and grow its large OLED panel business.
Due to this reason, President Jung Ho-young of LG Display made a statement during a press conference that was held at CES 2020 that LG Display would focus on large OLED panels this year and that LG Display would look to double the sales of large OLED TV panels this year compare to the sales from last year. He also stated that it would be possible for LG Display to start producing OLED TV panels from its Guangzhou fab sometime during the first quarter while emphasizing the importance of early normalization of the Guangzhou fab.
“We are planning to finish necessary preparations by the end of the first quarter.” said a representative for LG Display. “Specific schedule on the operation has not been decided yet.”
Staff Reporter Yun, Heeseok | pioneer@etnews.com & Staff Reporter Yun, Geonil | benyun@etnews.com

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