By Ricky Park
There are signs of a big change in 2015 in the 43” (42.5”) panel market. LG Display started releasing 43” panels in H2’14, and with the support of LG Electronics, as well as a strong competitor AU Optronics (AUO) joining in the supply market, shipments of 43” panels in March 2015 reached 1.2 million, almost as many as 42” panels in the same period. Shipments of 43” panels are forecast to surpass that of 42” in Q2’15.
Several factors increase the potential for success of the 43” panel segment:
- Higher productivity compared to other competing products: The main production fab is Gen 7.5, which can produce either 42” or 42.5” panels 8-up. This creates strong production cost competitiveness, because TV makers can promote 42.5” as 43” panels.
- Multiple suppliers: After LG Display introduced the panels to the market in August 2014, AUO started to supply them in October. China-based BOE Optoelectronics Technology (BOE) and China Star
- Optoelectronics Technology (CSOT), which do not have Gen 7.5 fabs are expected to start production as early as this year, responding to increasing demand.
- Market potential: Demand for 32” panels may shift to the 40-43” TV panel segment. With falling overall TV prices creating consumer interest and added features for 40-43” TVs like ultra-high definition (UHD) and wide color gamut, panel makers are looking toward the larger panels. In addition, panel manufacturers are shifting their lineup from 46/47” panels to 48/49”, which leaves a line-up gap between 40/42” and 48/49”. 43-inch panels are expected to replace some of the demand for 40” panels and most of the demand for 42” panels.
- Investment into efficient production lines: The news of the investment of BOE into a new Gen 10.5 line will promote the 43” panel market even further. BOE said that production focus will be on ultra-large sizes, but 43” panel can be produced 18-up out of one sheet of mother glass at the same time, with a glass efficiency over 93 percent. The risk of investing in the uncertain ultra-large TV panel market is offset by the potential for 43” panels that could become a key product.
The multi-model on a glass (MMG) method is another possibility. Recently, AUO started to use MMG to mass produce 21.5” and 43”; BOE and CSOT are planning to mass produce 18.5” and 21.5” panels, respectively, with 43” using MMG. However, the smaller panels produced this way may contribute to over-supply for the monitor market, which is declining.
Also, LG Display plans to produce 42.5” panels 10-up in Gen 8.5, investing in dual exposure equipment. These methods will most likely end up in reduced yields and thus increased production costs in the early stages.
Image via Nikkei Asian Review