Chinese takeover of LCD panels, a threat to Samsung and LG

The growing control of Chinese display makers over the production of LCD panels and their mergers orchestrated directly by the Chinese government threaten to break South Korea's dominance in the TV and display market , announces UBI Research.

China: LCD panel market orchestrated by the Chinese government

Choong Hoon Yi puts forward a Chinese state plan to, after several “controlled” mergers, bring out only three national players in charge of the display market. HKC is expected to merge with IVO, BOE with Visionox, and CSOT's T4 plant and EDO's Shanghai plant are expected to join Tianma Group as the sole Chinese automotive OLED panel supplier. These major maneuvers within the Chinese screen industry with the aim of these companies setting their selling prices and maintaining them, for lack of competition, and thus maximizing their profitability. In addition to a pricing problem on LCD TV panels, companies Samsung and LG could eventually see their delivery of TV panels reduced by the sole will of Chinese manufacturers. In short, South Korean brands run the risk of seeing Chinese players reserve the same fate for them as they did to Japanese brands involved in the TV market a few years ago (Hitachi, Panasonic, Pioneer, Sharp , Sony, Toshiba). At best, the Japanese groups have been overtaken and are now struggling, at worst they have disappeared from view.

The word to Choong Hoon Yi, CEO of UBI Research

“Chinese display panel makers monopolizing the liquid crystal display (LCD) market will pose a long-term threat to TV companies Samsung and LG,” says Choong Hoon Yi, CEO of UBI Research interviewed by The Elec . For while many view the dominance of Chinese companies in the LCD space as a threat to South Korean display panel companies, the biggest threat is to TV makers. And the collapse of Samsung and LG's TV business will drag down all companies involved in the value chain," the CEO warned.

And to further illustrate his point, Choong Hoon Yi clarified that LG was currently in talks with a potential Chinese buyer for its LCD factory in Guangzhou (CSOT, a subsidiary of TCL and whose name was put forward by Choong Hoon Yi, denied being this one a few hours ago).