Oled Screen For Sale.The LCD panel industry has changed again. In 2022, as the dividend of the “home economy” brought by the epidemic disappeared, the conflict between Russia and Ukraine and global inflation further suppressed public demand, and global electronics consumption entered a period of weakness.

In April, fewer than 19.5 million LCD TV panels were shipped, falling to the lowest point since the outbreak. In the case of overseas production cuts, the five manufacturers of Chinese mainland, BOE, TCL Huaxing, Huike, Nanjing CLP Panda and Rainbow Optoelectronics, accounted for 68.5% of LCD TV panel shipments, setting a new high for Chinese companies in the world, according to Omdia.

Panel factories on the mainland have also been cutting production recently. According to industry insiders, the panel industry in the mainland is expected to reduce production by about 20%, covering the whole generation of products, the largest production reduction in more than a decade.

According to the survey data on the commissioning of CINNO Research monthly panel factories, the average growth rate of domestic LCD panel factories was 84.9% in May 2022, down 3.5% from April. Among them, the average farming rate of the low generation line (G4.5-G6) is 76.4%, and the average rate of the higher generation line (G8-G11) is 85.9%.

Many experts predict that generally speaking, the third quarter is the traditional peak season for LCD panels, and this year there may be a “sluggish demand in the peak season”.

The upstream industrial chain of electronic products has also been seriously impacted. It is reported that global LCD panel prices have entered a period of decline for more than a year, and there is no sign of reversal at present. Some industry insiders said that the recent transaction price of the panel industry has been lower than the cost price, and panel factories have suffered substantial losses.

In order to reduce losses and return supply and demand to a relatively balanced state as soon as possible, the global LCD panel industry is greatly reducing production, and manufacturers in South Korea and Taiwan have begun to reduce production relatively earlier.

Various signals show that the LCD panel industry may have ushered in a new iterative period.

The last major production reduction in the LCD panel industry can be traced back to the 2008 economic crisis.

At that time, smartphones and tablets were not yet popular, and the main products for using LCD panels were still televisions and computer screens; Chinese mainland’s LCD panel companies were not yet on a large scale, and the mainstream manufacturers in the market came from Japan, South Korea and Taiwan. In 2008, Samsung, LGD, Youda, Chi Mei and Sharp accounted for more than 85% of the industry’s production capacity.

In 2007, the supply of the panel industry was less than the demand, and various manufacturers had positive expectations, but in 2008, the impact of the subprime debt crisis in the United States appeared, the demand for LCD TVs in Europe and the United States declined sharply, and the sales volume in Japan and South Korea also slowed down. The Chinese market has also experienced a decline in growth rate affected by the snowstorm, Wenchuan earthquake, real estate market turmoil and long-term stock market adjustment.

This situation makes the major household appliance enterprises bear great profit pressure, in order to stabilize revenue, the major brands play a price war to clean up inventory.

At that time, domestic brands lagged behind in panel technology and relied on foreign capital, so the cost of panels was higher, while the operating costs of foreign investors in China were higher. At that time, foreign brands generally adopted the strategy of “panel profits to support the price war of the whole machine”.

However, the oversupply has led to a substantial decline in the profit margin of the panel business, foreign brands can no longer support the price war, but also have to give up the expansibility strategy. In the first quarter of 2009, Hitachi, Panasonic, Sony, Toshiba and other Japanese companies all lost more than 100 billion yen and had to throw out layoffs and factory closures; LG and Samsung also cut their capital expenditure in 2009 and started the production reduction mechanism.

It was also during this period that Chinese enterprises seized the opportunity.

From January to June 2009, the Ministry of Industry and Information Technology and the Taiwan Affairs Office of the State Council organized China’s nine major color TV manufacturers to Taiwan to purchase more than 12 million LCD panels with a total value of 4.4 billion US dollars.

Subsequently, Hisense, Konka and Chi Mei joined hands to enter the liquid crystal module industry, and Changhong and Youda jointly established Changzhi Optoelectronics Co., Ltd. the new business model after the opening of the liquid crystal industry chain on both sides of the strait has broken through the predicament that domestic enterprises generally lack market competitiveness due to “lack of screen and less core”, coruscating a stronger competitiveness.

In April 2009, the State Council approved and issued the Electronic Information Industry Adjustment and Revitalization Plan, which clearly listed TFT-LCD LCD as a major project for the current key development.

At that time, there were opposition voices who thought that domestic enterprises were expanding their production lines blindly, and that they were very likely to face the risk of overcapacity, project losses and no real upstream core technology in the future. but China’s huge population shows its advantage-we have consumption potential that Japan and South Korea cannot match.

With the introduction of the domestic policy of “home appliances to the countryside”, the domestic LCD panel market rebounded strongly in 2009, expanding domestic demand makes the new capacity quickly have the opportunity to give full play to its talents. Peng Shuanglang, then executive vice president of Youda Optoelectronics, said bluntly: “Home appliances went to the countryside to make the replacement of liquid crystal CRT blow through the vast rural market, accelerating the revolution of LCD panel replacement.”

According to the DisplaySearch statistics report, global shipments of large-size TFT LCD panels reached 665 million in 2010, an increase of 26% over the same period last year, and netbooks and tablet panels rose by 64%.

With the advent of the 4G era and the comprehensive popularity of smart devices, the global demand for display terminals has maintained a steady growth in the next few years. Screen, as an important port for information exchange, plays a more and more important role in life.

According to Omdia data, the total production area of LCD panels in the world has an average annual compound growth rate of 7% from 2010 to 2020. Since surpassing South Korea for the first time in 2017, Chinese mainland display panel shipments have been ranked first in the world.

Growth, recession, growth, recession. Industry cycle changes are inevitable, the current wind of production reduction and capacity contraction in 2008 have certain similarities, a new round of iterative period has come, domestic enterprises must be prepared to deal with.

Liquid crystal industry is a capital-intensive, technology-intensive, labor-intensive three high industries.

At the end of the last century, due to the huge technology gap between China and overseas, China adopted “market for technology” to introduce joint ventures. But joint ventures make it difficult for us to get rid of foreign-funded enterprises for technology and capital.