The past two years have undoubtedly been the hottest time for China's display panel investment. Under the concept of ubiquitous display in the era of the Internet of Things, the Chinese panel industry has opened a huge space. The rapid growth of investment in the Chinese display panel industry is partly due to the vast Chinese market, and investors are extremely optimistic about the panel industry. On the other hand, it comes from the strong support of the local governments for the panel industry, and a large number of preferential policies have been granted in terms of land and taxation.
China LCD panel overcapacity
In the next five years, the world is expected to add 18 panel production lines, and mainland China will occupy 14. Driven by market and policy factors, foreign panel manufacturers will actively come to China to build factories, which will further accelerate the global panel production capacity to gather in mainland China. China is expected to overtake South Korea in 2019 and become the number one producer of LCD panels.
Korean companies focus on OLED technology
However, with the hot investment in the panel industry, the signs of disorderly investment have also been initially revealed. In some places, there are blind routes, non-leading companies are pouring in, and the blossoming of the industrial layout is not conducive to the healthy development of the industry. At present, China's LCD panel market has already experienced overcapacity. At the same time, the development speed of display technology is so fast, and rapid iteration also brings new variables to the industry in the direction of development.
Disordered investment in panel factories may lead to structural surplus in the industry
As early as a few years ago, Samsung, the world's largest panel manufacturer, began to realize that after Chinese panel companies intervened in LCD panel production, it might cause excess capacity, so it began to sell LCD panel production lines or switch to more advanced OLED panels. South Korea's other large panel company LG Display LCD has shut down many LCD production lines to produce large-size OLED panels. Under the situation of upgrading display technology, if Chinese panel companies continue to invest blindly in LCD panels, they will once again lag behind Japanese and Korean companies.
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