At the “39th Display Industry Forum” sponsored by market trend research company Informa / Omdia, the current situation of Japan Display (JDI), which can be said to be the Hinomaru FPD Union, which remains as a Japanese display manufacturer, and Sharp, which is under the umbrella of Taiwan Hon Hai Precision Industry. Regarding the future, Linda Lin, an analyst in charge of Japan and Taiwan based in Taiwan, announced the results of the survey.
JDI that cannot escape from Apple’s request
Due to increased demand for Apple’s iPhone 11 (6.1-inch) LCD model, the Mobara factory was able to maintain a high operating rate of 70% to 80% in the first half of 2020. Apple’s demand is likely to fall slightly after the fourth quarter and drop sharply after 2021. In addition, the demand for in-vehicle panels is declining worldwide due to the influence of the new corona, and the operating rate of 4-4.5 generation fabs is low.
Mass production of 1.78-inch small organic EL panels for Apple Watch started in January 2019, but demand is not growing, and the monthly production of glass substrates in the first half of 2020 is about 2000, and the number of shipments is about 1.5 million. It is said that he stayed at. In addition, there are many uncertainties among JDI, Sharp, and Apple regarding future operations at the Hakusan plant that was sold to Sharp, and he said that there will be an official announcement in the future.
Apple to strengthen relations with Sharp
As for Sharp’s display factory, Sakai Display Products (SDP)’s 10th generation panel factory for TVs is in full operation.
The 10.5th generation factory of Caoshi Eyeglasses Sakai International Technology Guangzhou (SIO), which is under the umbrella of SDP, is also rapidly increasing its operating rate, but the Sharp Kameyama Factory, which is known for manufacturing masks for new corona countermeasures, is in operation. The rate is as low as about 40%. “Sharp has decided to spun off its display business, but it will be closely watched as the acquired JDI Hakusan plant is handled in the future,” Lin said.
On October 1, after this lecture, Sharp separated the display business from the main body of Sharp because it will speed up decision-making in the display business and secure competitiveness with a view to acquiring external funds through investment from other companies. It was spun off.
The newly created subsidiary will take over the display business of Sharp Display Technology (headquartered in Kameyama Office), Mie Office, Sakai Office, and the acquired JDI Factory. In addition to liquid crystal and organic EL, he is also in charge of developing next-generation displays such as micro LEDs. Sharp spun off its semiconductor business a little earlier, but could not obtain external funds and is trying to sell a part of its Fukuyama office to Mitsubishi Electric to prolong its life, so there are many prospects for the spun off for the dismantling of Sharp. It’s difficult.
Lin said, “Apple iPhone LTPS LCD panel suppliers JDI and Korea LG Display may reduce supply in 2020. For Sharp, the acquisition of JDI’s Hakusan plant has replaced LG Display with LTPS LCD. This is a great opportunity to supply more mobile panels to Apple. “
Sharp acquired the building and clean room of the JDI Hakusan factory, Apple acquired the manufacturing equipment from JDI, and the Sharp-Apple Union has acquired the LTPS production capacity of 26,000 sheets per month on the 6th generation (G6) board. ..
For this reason, JDI’s supply share for iPhone will decrease, but it is expected to be sold based on the management strategy of reducing the sales composition ratio for smartphones from 70% to 50%, and as a result, iPhone will be sold in 2021. Sharp is expected to reverse JDI in terms of the supply share of LCD models.
Finally, Lin said, “Two Japanese display makers need external help to get out of the financial crisis. Sharp is Apple to integrate its OLED business. JOLED has finally found a Chinese manufacturer (TCL / CSOT) as a partner to collaborate with the inkjet printing business. JDI says that demand for LCD panels from Apple will decrease in the near future. We need to make sales efforts to find new customers in anticipation. “
What will happen to the display industry in 2020?
Omdia’s Display Technology and Investment Analyst (Kyoto), Ckarles Annis, summarized the display industry as of mid-2020 as follows:
- 2020 is a rare series of surprises. The display industry was pessimistic from April to May, but consumers began to upgrade their electronics as telecommuting, home lessons and video games at home became new normal. The market has turned positive. The impact of the new coronavirus on the display industry is heading in the right direction, unlike many other industries. The 2021 outlook for the display industry is positive.
- Demand returned in the third quarter of 2020 in all display applications. Panel makers are expected to return to profitability in the third quarter.
- The acquisition of TCL SCOT’s Samsung factory in China and Sharp’s acquisition of JDI Hakusan factory are positive moves for the display industry.
- The launch of a new fab in China has been delayed due to the impact of the new Corona.
- The closure of the Korean LCD production line has also been delayed. Meanwhile, Chinese are gradually increasing their production capacity. If demand for displays is as expected in 2021, the withdrawal of LCDs from South Korea could tighten display supply, which would be a tailwind for Chinese.
Based on the above, if the annual 2021 display industry weather forecast (economic forecast) is drawn, it is predicted that the display industry as a whole will change from cloudy to sunny. The macro economy will be cloudy in 2021, although it was raining in 2020 due to the new coronavirus. Increased production capacity and capital investment will be raining, but other than that (financial status, supply and demand balance, fab occupancy rate, organic EL business, inventory status) will be on a recovery trend from the latter half of 2020, and all will be fine in 2021. It is expected to become. “I want to look forward to the coming 2021”, Annis said.