What They Say
The Elec reports that Samsung Display may extend its production of LCDs up to the end of 2022 after initially planning to end manufacturing this year. The L8-2 line may continue although L7-2 has had equipment removed as it is being converted for OLED production.
What We Think
There are two factors at work here. First, pricing for LCDs, as we have reported a lot, is better than it has been for a long time, so plants are running at high profitability and without a feeling that there has to be more investment, that is positive for cash. Why would you close a fab in this situation?
The second point is that Samsung’s VD business still needs LCDs for its products and has to buy these on the open market. Samsung’s LCDs have been top quality and there have been reports that quality from China is not quite as good. We have also heard that Chinese makers are having trouble ramping their fabs and so are not able to deliver what they hoped (and had accepted orders for). (BR)
