[The Crisis of Korean Displays] Huawei Pushed to the Brink, Korean Display Industry Faces Chain Shock
Samsung and LG Export Suspension Realized Amid Chinese Low-Cost Offensive, Double Hardship
[Asia Economy Reporter Changhwan Lee] The US sanctions on Huawei are sending shockwaves through the display industry following the semiconductor sector. As the suspension of exports to Huawei by South Korea's largest display companies, Samsung Display and LG Display, becomes a reality, domestic display exports are immediately facing setbacks.
There are forecasts that Korean companies, already losing market share to low-cost Chinese displays, may face even greater difficulties due to this situation.
According to industry sources on the 16th, the US sanctions have led to the cancellation of Huawei's next-generation foldable phone launch within this year, making damages to Korean companies inevitable.
Ross Young, CEO of DSCC, a display-focused market research firm, stated on Twitter that "due to US sanctions on Huawei, the Mate X2 launch within this year has become difficult." CEO Young has been continuously updating related information, having revealed concept images of Huawei's foldable phone Mate X2 last month and predicting panel production possibilities this month.
It is known that Huawei's foldable phone Mate X2 was to use Samsung Display's latest 8.03-inch foldable OLED panel. From Samsung Display's perspective, losing Huawei, which achieved the world's number one smartphone market share in Q2 this year, means unavoidable losses.
The Huawei sanctions are also negative for LG Display. LG Display has also been supplying OLED panels to Huawei. Consequently, Samsung Display and LG Display recently applied for special export permits related to Huawei from the US Department of Commerce.
The Huawei risk is analyzed to be exacerbating the already difficult crisis in the display industry. Korean display companies have been struggling against the onslaught of low-cost Chinese LCDs. Currently, they have reached the point of withdrawing from the LCD business. On top of this, the recent spread of mid-to-low-end Chinese OLEDs in the market has heightened the sense of crisis.
According to market research firm UBI Research, as of Q2 this year, China's share of global mobile OLED purchases reached a record high of 52.5%. Korea's share was only 35%. Until Q2 last year, China's share was 42.8%, lower than Korea's 50.2%, but the situation has dramatically reversed in just one year.
A UBI Research official said, "As the OLED market in China rapidly expands, Samsung and LG are also considering adopting Chinese OLEDs, causing upheaval in the display market," adding, "To avoid being outpaced by China, our companies must stake their lives on developing next-generation displays and securing the market."
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