Reports out of Korea say that Samsung is strategically diversifying its supply chain for large LCD panels for TVs in response to an ongoing patent lawsuit with BOE, China’s largest panel maker. This move by Samsung comes as Chinese companies’ share in the LCD panel market for TVs is projected to increase to 70.4% from 65.5% in 2022, according to TrendForce. By reducing its reliance on China, Samsung aims to improve its bargaining position during price negotiations and mitigate the impact of price fluctuations on its annual TV shipments, which predominantly consist of LCD TVs.
Chinese companies currently supply approximately 70% of the LCD panels for Samsung’s TVs, withTCL CSOT being the largest supplier, followed by HKC and BOE. AUO holds a share of around 20%, while Sharp, LG, and others account for around 10%.
The patent dispute between BOE and Samsung led to the latter seeking alternative supply lines for LCDs. Samsung Display filed a lawsuit against BOE with the U.S. International Trade Commission to ban the import and sale of infringing Chinese panels. In retaliation, BOE filed a counter-suit in China, alleging an infringement of LCD panel patents by Samsung. Noted Chinese vendors, Tianma, TCL CSOT and Visionox, have recently jumped on board BOE’s case against Samsung
To address the challenges posed by Chinese manufacturers’ price hikes, Samsung is actively looking to strengthen cooperation with Taiwanese and Japanese panel makers. Samsung is asking AUO and Sharp to expand their supply volumes, as LG Display is currently undergoing restructuring and lacks the capacity to increase its supply. LG Display is instead focusing on partnerships in the next-generation panel market, including supplying OLED panels for Samsung’s large 83-inch OLED TVs.
