The spread of covid-19 in Europe and the us is likely to hit TV demand hard, with demand for panels set to reverse in the second quarter.Samsung and LGD will both shut down production of large-sized LCD panels in South Korea this year, and samsung is even considering closing an 8.5-generation plant in suzhou for sale.Market adjustment unit CINNO Research estimates that this year China's panel factory capacity market share will climb to 63%, South Korea's panel factory market share fell to 18%, Taiwan's panel factory market share is about 15%, by 2021 China's panel factory market share will break through 80%.
CINNO Research pointed out that samsung display is accelerating its process of shutting down LCD panel production and switching to OLED panel production due to the epidemic that led to the decline in LCD TV demand. In addition to the closure of three large-size LCD panel plants in South Korea in the fourth quarter of 2020, even the 8.5-generation plant in suzhou has not ruled out closure for sale.
In 2019, samsung's production area of large-size LCD panels with more than 7 generations in South Korea accounted for about 12.2% of the world's total, and its 8.5-generation plant in suzhou accounted for 15.7% of the total.Samsung's accelerated shutdowns mean that global competition for large-sized LCD panels will accelerate from South Korea to China.
In the global LCD panel production line, the proportion of China's panel factory's production area will be further increased from 54% in 2019 to 63% in 2020, and the proportion of South Korea's panel factory market will fall to less than 20%.With the gradual closure of Korean panel factory, by 2021, the market share of Korean panel factory capacity is only a single digit, about 6%, China's market share will jump to 75%, 2022 market share will break through 80%.Taiwan panel factory market share is relatively stable, the next few years will maintain at 13%-15%.
Samsung has shut down factories twice in the past, including the l7-1 in 2016 and the l8-1 in 2019, and sold equipment to Chinese panel factories.This time will also seek external buyers, but now the panel seriously oversupply, CINNO Research believes that it is not easy to sell, as for suzhou 8.5 generation plant because of the location, the sale opportunity is greater.
CINNO Research said that since march, the covid-19 epidemic in China has been gradually under control, actively resumed production and production, and South Korea has also taken very strict prevention and control measures, panel supply has not been affected too much.However, with the spread of the epidemic around the world, especially in Europe and the United States, the epidemic rapidly worsened and exceeded expectations, leading to the cancellation of many international events and exhibitions, and the closure of international air routes, international trade and transportation in many countries, seriously affecting the supply and demand.
In addition to samsung's accelerated pace of plant closures, production at China's panel factories has slowed, with production at boe's 10.5 generation plant, huike's 8.6 generation plant and SIO's 10.5 generation plant delayed due to fears of a collapse in demand.
As the new production capacity is put into production at a slower time, the Korean factory accelerates its exit from the market. At the same time as the demand decreases, the panel supply in the second half of this year will be significantly reduced, so that the market supply and demand variables increase this year.