What They Say
OLED-Info reports data from Omdia that forecasts production of 8.3 million OLED TV panels in 2021, up 86% on last year’s 4.5 million units. That’s a slight increase in the firm’s forecast and ahead of LG Display’s plan of 8 million units.
What We Think
LG Display has been expanding its range of OLED sizes and that may make the unit calculation subject to a fair amount of variation within the overall capacity of the fabs. As we reported last week, LG is being conservative on its further investment. The ‘spectre at the feast’ is the rumour that keeps returning that Samsung might buy OLEDs from LG. Samsung has been clear that it hasn’t bought OLEDs for TV from LG, but it feels pretty certain that it has thought about it and almost certainly discussed it with LG. My gut still tells me it won’t happen, but stranger things have happened in the past!
One reason I say that is that Samsung would have to buy a lot of panels and that would either mean new investment in fabs or squeezing out other customers. If LG wanted to make a big investment, given that Samsung is also working on QD OLED and QNED, the firm is likely to need a long term contract to protect itself. It makes me remember when I was in display sales. Sometimes somebody would come to me with a big enquiry. If they complained that they didn’t get a big volume discount, I would have to explain that if they only wanted a few, it was easy to give a discount, but if I sold a high volume, it would mean a big drop in margin for too much of my sales, and in order to keep regular customers supplied, I would have to accelerate the shipping, which would cost me a lot!
So, if Samsung was likely to be a small customer, it would probably be a more attractive customer for LG Displays. (BR)
