Charles Annis, an analyst at market research firm Omdia, has taken on the rumors that have been circulating in the flat panel display (FPD) industry that Sharp is planning to close its Sakai Display Products (SDP) Gen 10 LCD factory in Japan. The rumors began spreading during the week of March 17, 2024, and were reported in the public press by March 21. As of the time of writing, Sharp has not publicly commented on the matter.
The Sakai Gen 10 factory, which began commercial production in 2009, was the world’s first Gen 10 class fab. Despite its technical achievements, the factory has faced challenges due to the global economic recession and the shift of high-volume LCD TV panel production to lower-cost regions. SDP has struggled with profitability, and its ownership has changed several times over the years.
If Sharp decides to close the factory, it could have implications for the FPD industry. Annis suggests that while some of SDP’s key clients, such as Walmart Onn, Samsung VD, and LG Electronics, may face challenges, the overall impact on the TV supply chain would likely be minimal. The closure could also lead to moderately higher panel prices due to tightening supply.
The potential closure of SDP would represent a significant step towards industry consolidation, with production becoming even more concentrated in China. If the factory is shut down, leading Chinese TV panel suppliers such as BOE, China Star, and HKC could gain more leverage when negotiating with global TV brands.
Sharp has not confirmed any of the content or scenarios discussed in the blog post, and the company’s strategy to resolve the challenges faced by SDP remains uncertain. The market research firm Omdia will continue to monitor developments in the FPD industry and provide updates as more information becomes available.
