BOE has put into production of OLED display panels in 2017, but its technology should really reach the maturity level in the third quarter of last year. It was not until the fourth quarter of last year that Huawei’s mate20 Pro began to use BOE’s OLED display panels, which are also BOE’s OLED displays. The screen panel has been adopted by brand enterprises for the first time, which proves that its OLED display panel has entered a mature stage.
China’s display panel industry grew out of nothing, and now it has become the world’s number one. It took 15 years and after enjoying huge profits in 2017, LCD panels quickly fell into a price war, leading to the emergence of profits for panel boss BOE In order to increase profits, domestic display panel companies are actively developing high-end panel technology OLED, which is expected to enter the stage of large-scale production this year, and BOE may therefore make another huge profit.
The leader of the domestic display panel industry is undoubtedly BOE. It intervened in the industry in 2003 through the acquisition of Hyundai’s backward LCD panel production line. It took six years to fully understand the LCD panel technology. It began to expand in 2009 and to 2017. Its most advanced 10.5 generation line was put into production in 2009, which is also the most advanced LCD panel production line in the world, and BOE has become the world's largest LCD panel manufacturer in one fell swoop.
2017 is also a bumper year for domestic display panel companies. Due to the global shortage of LCD panels in 2016 and the continuous price increase, BOE’s net profit in 2017 also increased by 300% year-on-year to 7.5 billion yuan, more than a decade The struggle finally allowed BOE to enjoy the huge profits that it deserves as the leader of the industry.
However, the good times are not long. With the rapid expansion of the production capacity of Chinese display panel companies, coupled with the OLED panels beginning to replace LCD panels, the proportion of OLED in the smart phone market is approaching 50%, and in the TV market OLED is also beginning to be used in high-end TVs. The market has accelerated its popularity, which has led to a rapid overcapacity of LCD panels, and LCD panel prices have begun to fall. Affected by the continued decline in LCD panel prices, BOE's performance in the third quarter of 2018 showed that its net profit fell by more than 80% year-on-year to only 404 million yuan. In just over a year, the price of LCD panels fell rapidly like a roller coaster.
In the next few years, as BOE’s second 10.5-generation LCD panel production line is put into operation, and the 11th-generation line of Huaxing Optoelectronics will also be put into production, the overcapacity of LCD panels will inevitably continue. In order to increase the capacity utilization of LCD panels It is inevitable that the LCD panel market will continue to engage in price wars in the next few years. It is no longer realistic for BOE to obtain substantial profits in the LCD panel market. Faced with such a situation, domestic panel companies are accelerating the mass production of their OLED panels. .
However, BOE’s OLED panel production capacity is still relatively limited, which has caused Huawei to use both BOE and LG’s OLED display panels. It is said that BOE only supplies one-third of mate20 Pro’s OLED panels, and the other two-thirds are LG supply, which shows that the yield rate of BOE's OLED panel production line is still low, resulting in relatively limited production capacity.
The OLED panel production line of Huaxing Optoelectronics has been trial-produced in September last year, and it is expected to enter the mass production stage this year. With the OLED panel production lines of BOE and China Star Opto The pattern of 90% market share.
Domestic mobile phones have made great progress in the global market. Four of the world's top six mobile phone companies are Chinese mobile phone companies, namely Huawei, Xiaomi, OPPO, and vivo. Among them, Xiaomi, OPPO, and vivo are all supplied by Samsung with OLED display panels. This puts them under tremendous cost pressure, and at the same time, they are also limited by Samsung in terms of supply. OPPO and vivo have to pay a huge deposit in order to ensure that Samsung supplies OLED display panels. BOE and Huaxing Optoelectronics' OLED panels can be mass-produced. Hope to help them get rid of the situation of being constrained by Samsung. Of course, this is also conducive to the sales of OLED display panels of BOE and China Star Optoelectronics.
The OLED display panel business has brought huge profits to Samsung and is its second largest source of profit. It can be seen that the OLED display panel business is profitable. The successive production of OLED panels of BOE and China Star Optoelectronics has put pressure on Samsung. It is said that it has actively contacted and strengthened cooperation with Chinese mobile phone companies to prevent BOE and Huaxing Optoelectronics from having too much impact on it after the OLED display panels are put into production.
