Oled Monitor.Is the LCD screen better? In the epidemic, home work, study, life has become the norm, and the demand for televisions, monitors and other products has also ushered in a rapid rise.

Since most of these devices use traditional LCD panels, the price of LCD panels has also gone up, returning to the high point of early 2018.

Chinese screen manufacturers are making a lot of money in this wave of high LCD prices. On the other hand, Samsung, LG and other South Korean screen giants, which announced their withdrawal from the LCD industry in 2019, have said that they will fight for another year!

Standing at the moment, can we really say that Chinese screen manufacturers are no longer competitive in the field of LCD screens? In the field of LCD screen, do Chinese panel manufacturers really grasp the core technology in their hands?

From the early technological blockade and “lack of core and few screens” of European, American, Japanese and Korean enterprises to more than half of the market share in the field of LCD screens today, how did Chinese screen manufacturers turn around and counterattack?

First, net profit has tripled, with Chinese mainland accounting for half of LCD.

Looking at the annual performance forecasts of various domestic screen factories in 2020, the face is full of “I made money.”

Take major screen manufacturers such as Beijing Oriental, TCL Huaxing, Shentian Horse and Vicino as examples, their net profit growth is at least above 60% year-on-year.

The highest year-on-year increase in net profit was about 227%, more than three times that of the same period last year, while BOE’s net profit exceeded 5 billion yuan.

There is no doubt that this wave of soaring net profit is inseparable from the strong price performance of the LCD screen industry this year. And today’s LCD screen industry, from the final panel manufacturing end, is already the “world” of Chinese manufacturers.

Chinese mainland manufacturers had a combined market share of more than 50 per cent in the field of large LCD screens in 2020. In May last year, JD.com ranked first in the world with a market share of 22.8%, and TCL Huaxing also reached 12.9%, ranking third in the world.

Large LCD screens are mainly used in the production of televisions and monitors, and the combined shipping area of these two types of products accounts for nearly 90%, so large size is undoubtedly one of the main battlefields of LCD panel competition.

There is no doubt that the Chinese mainland “two giants” pattern has been formed, and this has brought stronger bargaining power and enhanced profit levels, which are the source of excellent results in the earnings forecast.

At present, BOE’s gross profit margin in the field of large LCD screens is more than 15 per cent, while TCL Huaxing is more than 10 per cent, both higher than the industry average of 8.07 per cent.

Of course, the increase in the share of Chinese manufacturers is closely related to the closure of LCD production lines of South Korean giants and the gradual decline in production capacity.

In April 2020, Samsung announced that it would close all LCD panel production lines in South Korea and China by the end of 2020, and in January of the same year, LG also announced that it would shut down South Korea’s LCD TV panel production line at the end of the year, leaving only the 8.5G line in Guangzhou, China.

Korean production accounted for about 23% of capacity in the first quarter of 2020, and by the first quarter of this year, Omdia expects it to fall significantly to 8% in the future.

Although Samsung and LG have backed out that they will postpone the closure of the LCD production line, those who should come will only be late and will not be absent.

Second, the core technology of LCD panel is still a weakness, and the United States, Japan, South Korea and Germany dominate.

Throughout the LCD screen industry chain, it is roughly divided into three categories: raw materials and equipment, manufacturing and terminal products.

Chinese screen factories are mostly in the middle reaches, that is, the assembly and production of panels. The product from the production line of the Chinese screen factory is basically a packaged screen module, which can be sent directly to the product factory of the terminal manufacturer.

On the face of it, Chinese screen manufacturers basically do the work of “processing supplied materials”, which brings out one of our most obvious shortcomings, that is, lack of control of upstream core technology.

Nowadays, most of the screens used in most televisions, laptops in our hands, external monitors connected to PC desktops, and all kinds of car monitors are still LCD panels.

These screens appear to be only millimeter thick, but in fact, when a LCD screen is taken apart, there are a lot of layers.

Because the LCD screen is “passive luminous” and requires a light source, the LCD screen is naturally composed of two large parts: a liquid crystal panel and a backlight module.

In terms of the panel itself, the two parts with the highest cost are polarizer and color filter, and the total cost of these two parts alone is about 50%. This material sounds familiar to us, but the technical barrier to actual production is very high.

At present, polarizers and color filters are almost dominated by Japanese and Korean enterprises. Japanese electrician, Sumitomo Chemical, Sanli Chemical, South Korean LG and Samsung are the top five polarizer giants in the world, occupying an absolutely dominant position.

If you look at the color filter side, at present, the major screen manufacturers choose to make their own products. For example, the proportion of LG’s homemade products is more than 90%, and Samsung’s is more than 75%.

While the domestic head LCD manufacturers, such as Beijing Oriental, Tianma, etc., have less than 30% of the self-made proportion, while the remaining 70% have to be purchased from Japanese letterpress printing, big Japanese ink, Japanese Toray and other companies.

At present, domestic screen manufacturers all hope to increase the proportion of self-made localization of color filters, and are also supporting supply chain enterprises. For example, Dongxu Optoelectronics spent 3 billion yuan in 2015 to introduce the technology and production line technology of Japanese ink, and achieved mass production in 2018.

However, at present, most of the domestic color filters are mainly in the middle and low end, and there is still a big gap to be filled in the field of high-generation color filters in China.