"Supply Volume of 1.5 Million Units This Year, Expected to Expand to 4 Million Units in 2023"
[Asia Economy Reporter Park Sun-mi] LG Display, which holds the world's number one market share in TV displays, is increasingly likely to supply WOLED panels to Samsung Electronics, the world's leading TV manufacturer. Supply negotiations are underway, and if supply begins within the second quarter, there is growing anticipation that Samsung TVs equipped with WOLED panels produced by LG Display could be sold within the year.
According to the TV and display industry on the 29th, Samsung Electronics is currently in discussions regarding the supply of WOLED panels for TVs from LG Display and is reportedly in the final stages of review. An industry insider familiar with the situation said, "Both sides have reached a certain consensus on the need for an alliance," adding, "Detailed conditions are being reviewed."
Jung Ho-young, CEO of LG Display, stated at last week's shareholders' meeting in response to a question about the possibility of supplying WOLED to Samsung Electronics, "If the conditions are right and both sides can achieve a win-win, the possibility is open." Earlier this year, Han Jong-hee, Vice Chairman of Samsung Electronics, also said, "We are keeping all options open for panel purchases," not ruling out collaboration with LG Display.
The recent increase in the possibility of an alliance between Samsung Electronics and LG Display is closely linked to Samsung's launch of new OLED TVs, aligning both companies' collaboration needs perfectly. Moreover, neither side has many alternatives to expand their business without forming a partnership.
Samsung Electronics, aiming to expand the OLED TV market this year, has started pre-sales of QD-OLED TVs in the North American market. Samsung Display supplies the QD-OLED panels, but the quantity is insufficient.
The maximum annual production capacity of Samsung Display's 8.5-generation QD-OLED production line is only about 1 million units. For Samsung Electronics, the number one TV seller with over 40 million units sold annually, this quantity is far from enough to establish a strong position in the OLED TV market. OLED TVs have become mainstream in the premium TV market, with their share of sales increasing from 26% in 2019 to 41% in 2021.
On the other hand, LG Display holds the number one position in the TV display market and trades with most TV manufacturers worldwide except Samsung Electronics. The shipment volume of OLED TV panels is expected to increase from 7.45 million units last year to over 10 million units this year.
WOLED produced by LG Display uses the same OLED technology as Samsung Display's QD-OLED but differs in the light source method, hence the different names. It is also interpreted that Samsung Electronics naming its QD-OLED TVs sold in the U.S. as ‘Samsung OLED’ leaves open the possibility of using WOLED panels.
Already, the securities industry is flooded with analyses stating that Samsung Electronics will have no choice but to source panels from LG Display to maintain its premium TV market share.
Jung Won-seok, an analyst at Hi Investment & Securities, said, "The possibility of new capacity expansion for Samsung Display's QD-OLED panels is low for the time being, so missing the collaboration opportunity with LG Display would be regrettable," and predicted, "LG Display's supply of WOLED panels to Samsung Electronics will expand to 1.5 million units this year, 4 million units in 2023, and 5 million units in 2024."
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