What Display Daily thinks: The discussion of China’s monopolization of the display industry may not sound new to most people reading this. What is interesting is how much more of a discussion is taking place outside of the traditional discourse within the industry.
Let’s look at the fear factor another way. We are increasingly relying on automation, call it AI if you want, to manage and handle a number of our strategic services. The US may dominate the field of AI processing and software development but none of that technology works without a display. The military may not use a lot of displays, in the big scheme of things, but it take away those displays and what do you have? You have blindness.
The automobile industry is going to eventually be in a position where it can go blind, too.
So, there is a real sense of impotence to the US, but it also stretches to Japan, Taiwan, and South Korea. There is not any likelihood of a meaningful pushback against Chinese monopolization of the display industry by any of these countries as things stand today.
If none of this makes you think that there is a strategic imperative to create flat panel display manufacturing resources in the US, I am not sure what else you need to see happen before you change your mind. You could argue that a commitment to semiconductor displays, moving towards heavy investment in their development and use, for strategic purposes, should be a priority, but who is going to drive that? A bunch of startups who have yet to prove themselves?
The strategic value of display manufacturing needs to be addressed, it’s just that there isn’t a powerful enough lobby in the US to make the case for future investment. And where there are powerful lobbies, as in South Korea, there doesn’t seem to be much they can do about it, either.
The Chinese Will Dominate Flat Panel Display Manufacturing
Willy Shih teaches in the Technology and Operations Management unit at Harvard Business School. On Forbes, he outlines the increasing dominance of Chinese manufacturers in the global flat panel display industry and examines the significant implications of this trend. The pivotal transaction for Shih is when LG sold its stake in an LCD factory in Guangzhou, China, to TCL CSOT. This move, Shih argues, signals the rapid ascent of Chinese companies in the production of flat panel displays. The Chinese market share of LCD panels, particularly those used in televisions, will rise from 66% to 72% as a result, with nearly complete control over the ultra-large screen segment. He warns that the US currently has no domestic manufacturing capacity for these crucial components, and the industry is quickly moving toward a near-monopoly by China.
Shih emphasizes the ubiquity of flat panel displays in a wide range of devices, including televisions, smartphones, computers, and even vehicles. It is an assessment of how Chinese companies have used government subsidies and massive investment to build advanced manufacturing facilities. These subsidies have led to an oversupply of TFT-LCD panels, driving down prices and hurting profitability across the industry. While companies from Taiwan, South Korea, and Japan have sought to differentiate themselves through specialized products, such as automotive displays and premium LCDs for high-end clients like Apple and Microsoft, Chinese firms are catching up quickly. BOE, China’s largest display manufacturer, is building new OLED fabs, and Shih predicts that Chinese companies will soon surpass their South Korean competitors in terms of market share.
Shih concludes by highlighting the broader strategic implications of China’s rise in the flat panel display industry. He warns that the geographic concentration of supply in China could lead to vulnerabilities in global supply chains, similar to those seen in the semiconductor industry. Shih calls for more attention from policymakers, particularly in the United States, to the risks posed by this growing dependence on Chinese manufacturers for critical technologies. He suggests that, without significant intervention or investment, manufacturers outside China will struggle to remain competitive in this rapidly evolving industry.
