Japan Display (JDI) made an announcement in Tokyo today that it has terminated discussions with China’s HKC regarding cooperation on next-generation display technology. Instead, the collaboration will now focus solely on high-end automotive displays.
The negotiations, which commenced in April, had the objective of establishing display manufacturing facilities in China, using JDI’s eLeap OLED technology, with mass production slated to commence in 2025. The deadline for reaching an agreement was initially postponed from June to September.
According to Reuters, which first reported the story, the impasse arose from disagreements between the two companies regarding the licensing fee that HKC was expected to pay for JDI’s technology. Additionally, the talks were likely impacted by China’s economic slowdown and HKC’s recent decision to withdraw its IPO on the Shenzhen Stock Exchange, as reported by the Nikkei business daily.
In another development, JDI revealed that it has entered into a memorandum of understanding (MOU) with the local government in China’s eastern Anhui province to construct display panels in the region. The company aims to finalize this agreement by the end of the year.
The MOU for JDI G6/G8.7 eLeap Project in China
JDI provided more details of its intentions in China by saying that it has been actively working to create a global display ecosystem, starting with eLeap mass production at its Mobara, Japan G6 fab in 2024, expected to produce 1.3K sheets per month. To meet JDI’s expectations for customer demand it has decided to embark on the Wuhu eLeap project, which involves the rapid expansion of production capacity through an MOU with the Wuhu Economic and Technological Development Zone (WEDZ) located in Anhui Province, China. The finalization of this agreement is contingent on obtaining approvals from relevant authorities, and both parties aim to complete this process by the end of December 2023.
Upon finalizing the agreement, the two entities plan to establish an operating company known as Wuhu eLeapco immediately. Wuhu eLeapco will play a crucial role in the project’s execution.
The Wuhu eLeapco has ambitious plans for the project, including the construction of two primary facilities:
- A G6 fab with a monthly production capacity of 10,000 sheets.
- A G8.7 fab with a monthly production capacity of 30,000 sheets, with G8.7 sheets being more than twice the size of G6 sheets.
This expansion is expected to increase JDI’s eLeap production capacity by more than 50 times. The G6 fab is scheduled to commence mass production in November 2025, while mass production for the G8.7 fab is set to begin in December 2026.
Specific financial details, such as the total investment and shareholding ratios, are currently undisclosed due to a confidentiality agreement between WEDZ and JDI. However, these details will be disclosed once the final agreement is signed according to JDI.