LCD panel output to reach 150 mln units in 2014

The flat panel display (FPD) technology is quite mature in the world but the market is almost saturated. Under fierce market competition, the FPD industry begins to plan a new development way. In "FPD International CHINA 2011/Beijing Summit" held recently, Wang Dongsheng, chairman of China Optics and Optoelectronics Manufactures Association LCD Branch, said that "deep cooperation, coordinated development and joint value creation" among the cooperating partners from upstream to downstream of the industrial chain should be actively promote to form a complete industrial ecological chain and cooperative win-win circle.

Capacity increases but profit falls.

The FPD industry of the world, mainly concentrated in Japan, South Korea and China, maintains a fast growth trend in recent years. Zhou Zixue, chief economist of Ministry of Industry and Information Technology made an introduction that the output value of the FPD industry exceeded $90 billion in the world in 2010. There are about 20 production lines of advanced-generation panel in the globe and new technologies like 3D and LED backlight emerge constantly.

FPD was first applied in portable products like calculator and watch and later in laptop, television, etc. Small to beeper and cell phone, and large to television and advertisement screen, the size of FPD ranges from 0.2 inch to over 100 inches. It is applied in various industries including family consumption, medical, vehicle-mounted and aviation.

China's FPD industry started late but improved quickly. Starting from scratch in 10th Five-year Plan period, achieving a leap from small to large size and from earlier-generation to advanced-generation line, the industry enjoys a substantially improved regional concentration. According to data, as for TFT-LCD (Thin Film Transistor Liquid Crystal Display), one sixth-generation, four fifth-generation and tow fourth-and-half-generation production lines had been in volume production in the country by 2010. Moreover, with volume production of the eighth-and-half-generation line by BOE in Beijing in June, China FPD industry entered the new phase of advanced generation. It is estimated that the annual output of LCD panel will reach 150 million pieces in 2014.

The capacity of the advanced-generation line of the foreign manufacturers also increases substantially. Since 2009, manufacturers like Samsung, AUO, Chi Mei Optoelectronics and Sharp have started the advanced-generation production lines one after another and the panel capacity has been improved largely in 2010. The shipments of large-size panel were up to 234 million pieces only in Korea in 2009. Under such a background, FPD is oversupplied and the industrial profit rate reduces gradually. Liu Ruilin, chairman of Tianma Microelectronics Co., Ltd. admits that the profit of FPD industrial keeps falling and a lot of enterprises made a deficit from the fourth quarter of last year to the first half of this year.

Seeking breakthrough through transformation and cooperation

Under the pressure of market competition, the FPD industry is planning a way out through transforming to the advanced-generation production line. Typically, a lot of manufacturers of application product speed their steps of product upgrading. For instance, with the drive of new technologies like 3D, touch panel and electronic display, applications including flat panel computer, smart phone and smart TV all bring profit to the FPD industry.

Mobile terminal products led by flat panel computer and smart phone have entered people's daily life quickly. According to the research report by Topology Research Institute, an industrial research institute, in 2011, the shipments of flat panel computer will exceed 50 million and smart phone 388 million. With the drive of two leading products, the demand for touch panel will be up to 951 million pieces in 2011, increasing by over 30 percent compared to 700 million in 2010 and the shipment sum will reach $8.5 billion.

Panel demand of flat panel computer, cell phone and laptop leads panel manufacturers in countries like Korea give up their advantages in large-size panel and pay more attention to small-size one, which provides a space of development for panel manufacturers in the main land of China. Moreover, presently China has become an important R&D and manufacturing base for FPD industry in the globe and formed four industrial concentrated regions including Bohai Sea rim, Yangtse Rive Delta, South China and mid-west region. It attracts a large batch of foreign companies in equipments, spare parts and materials to invest and establish factories and the local attached supply chain is forming gradually.

Zhou Zixue said that in order to promote the development of rising FPD industry, Ministry of Industry and Information Technology will enhance planning guiding and policy support, strengthen innovation ability construction, encourage enterprises to increase investment and concentrate resources to overcome core technologies restricting industrial development so as to improve product quality and performance and reduce cost; improve the industrial chain, speed up the R&D and industrialization of 8 matching products like glass substrate, color filter and special gas and increase the proportion of local supply; master scientifically the development trend and rhythm of the rising display technologies and promote industrialization.