LCD will be in short supply within five years!

On June 19, according to Korean media, it is predicted that liquid crystal displays (LCDs) will be in short supply within five years.

On June 19, according to Korean media, it is predicted that liquid crystal displays (LCDs) will turn into a state of supply exceeding demand within 5 years.

Market research company Counterpoint said on the 16th (local time): "LCD demand will grow by an average annual rate of 4% between 2023 and 2029, while production capacity will grow by an average annual rate of only 1% during the same period."

LCD demand is expected to reach a low point in 2023 by area and grow by an average annual rate of 4% from 2024 to 2029. The profitability of LCD panel manufacturers is also expected to improve next year.

Even during the epidemic period (2020-2023), the LCD market experienced exceptional growth from the second half of June 2020 to the first half of 2021. From the first half of 2020, the LCD market saw "excess demand" due to the increase in demand for home office and remote learning, the increase in demand for IT products, and the economic stimulus policies of major governments. However, since the second half of 2021, LCD demand has fallen sharply and reached a low point in 2023.

In 2023, global LCD production capacity decreased by 2% due to the closure of small-size factories. Despite the closure of Sharp's 10th-generation LCD factory in 2024, LCD production capacity still increased by 1%.

Counterpoint said: "LCD production capacity in South Korea and Japan will decrease by 20% from 2023 to 2029, but China's production capacity will increase by 18%, so global LCD production capacity will increase on an average annual basis of 1%."

"By 2029, LCD factories in India will be put into operation. The operating rate of LCD equipment is expected to recover to around 80% by 2028 and is expected to rise further by 2029." The agency added.

In addition, Counterpoint also predicts that due to the short supply of LCD, rising LCD prices may lead to increased demand for OLEDs in all application areas. This may lead to an increase in the penetration rate of OLEDs in the IT and TV fields. Currently, the penetration rate of OLEDs in the IT product and TV markets is less than 5%.

This data does not include the newly added large-size OLED investment in the latest forecast.

OLED demand (by area) is expected to grow by an average annual rate of 12% between 2023 and 2029, which will be higher than the overall display demand growth rate (4%).

Counterpoint expects OLED to grow in multiple fields such as TVs, smartphones, and IT products. By 2027, the proportion of OLED demand in each application field (by area) will be 42% for smartphones, 36% for TVs, and 15% for IT products.

Counterpoint said that the shortage of LCDs may promote investment in large-size OLED production capacity. Global OLED production capacity is expected to grow by an average of 5% per year from 2023 to 2029. During this period, the growth rates of various regions are expected to be: 3% in South Korea and 8% in China. The expansion of production capacity will mainly come from flexible OLED production lines for mobile devices and IT products, as well as hybrid OLED (glass substrate + thin film encapsulation) production lines.