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LG Turns To China To Secure OLED TV Future

- Jan 02, 2018 -

South Korea’s trade ministry has formally approved proposals by LG to start manufacturing OLED panels in China.

LG Display Co Ltd, which makes the OLED panels used in OLED TVs produced by LG Electronics and a growing number of other brands, had stated five months ago that it was intending to invest around 5 trillion South Korean won (US$4.5 billion) in a large-scale OLED production facility in China’s Guangzhou province.

Now that this decision has been ratified (as reported byReuters) by a trade ministry commission in LG Display Co. Ltd’s home country, the China-based production facility is expected to come online by the second quarter of 2019. And once it does, its impact on the OLED TV market will be massive.

According to Bussiness Korea, LG Display claims that the new facility will be capable of producing around 60,000 8.5-generation OLED panels a month. This would essentially instantly double the amount of OLED panels available to TV manufacturers each month, making it much easier to meet the surge in demand for OLED TVs many AV industry analysts are predicting over the next few years.

The surge in production may also lead to a further reduction in OLED TV pricing, following the drops this year that have joined greatly improved picture performance in making OLED 2017’s biggest TV success story.

All of this looks like not just welcome but outright necessary news for LG Electronics’ TV division. After all, as recently as August industry analyst Display Supply Chain Consultants was claimings that according to its research, OLED wasn’t going to be able to compete in the long term with its LCD rival - or, more specifically, its ‘QLED’ rival - in the TV space simply because it wouldn’t be able to make enough panels to satisfy demand.

LG’s China moves might potentially not solve all of the supply issues raised by that DSCC support. In particular, the fact that the new Chinese facility seems likely to focus on 8.5-gen production could be an issue in a market where people are looking to buy ever-bigger TVs, given that 10.5-gen facilities are generally considered the better option for the production of 65-inch and 75-inch TVs.

Nonetheless, the formal go-ahead on the new China-based LG Display production plant is surely at the very least a huge stride towards ensuring that the deserved surge in popularity OLED TVs have started to enjoy in 2017 is not after all going to come to a crashing, supply-induced halt any time soon.