With the support of policies and funds, China has become the largest LCD panel supply market in the world. According to the statistics of China Business Industry Research Institute, China’s panel production capacity accounted for about 29% in 2016, and it is expected that China’s panel production capacity will account for 56% by 2022.
LCD panel is promoted by policy, technology and capital
The LCD panel industry is capital intensive, labor-intensive, and driven by market demand. The development of panel enterprises needs policy support, technology development and capital investment.
LCD panel cycle weakened, the profitability of manufacturers increased significantly
Due to the two-year construction period and one-year capacity climbing period, the past LCD panel showed a strong periodicity. As the industry enters the late stage of maturity, the willingness of manufacturers to build new production capacity is greatly reduced. According to our supply and demand model, the compound growth rate of LCD production capacity in the next three years will be 3.1%; The compound growth rate of LCD demand side is about 6.5%, the supply and demand pattern of the industry will be improved, the periodicity will be significantly weakened, the panel price will be maintained in a reasonable range, and the profitability of LCD panel manufacturers will be greatly improved.
LCD panel has entered the era of China, and the panel “two heroes” take off
The display panel industry is a key industry supported by the state, and the state has issued a number of policies to support the development of China’s panel industry. It took nearly 10 years for China’s LCD panel manufacturing to complete the “leap forward” development, break through the foreign technology blockade, enhance the mastery of core technology, and complete the patent layout. The LCD industry chain is shifting to China. It is estimated that the market share of Chinese mainland will exceed 70% in the next 3-5 years.
LCD panel is still the mainstream of display field in the next 5-10 years
The mainstream display technology has changed from picture tube to liquid crystal panel for about 50 years. In the last round of the replacement of display technology, the main driving force of emerging technology is the growing consumer demand, and the core of the commercialization of emerging technology is still the price. We believe that with the blessing of mini LED backlight and other technologies, LCD panels will be able to meet consumers’ new demands for high definition and large screen display. Considering that the yield and cost of emerging technologies are difficult to solve in the short term, it is estimated that LCD panel will still be the mainstream technology in the display field in the next 5-10 years.
- Rise: from picture tube to liquid crystal display technology
With the development of material technology, display technology has developed from the initial cathode ray tube display (CRT) to flat panel display (FPD), and flat panel display is extended to plasma display (PDP), liquid crystal display (LCD), organic light-emitting diode display (OLED) and other technical routes.
The development of display technology can be divided into three stages. Take television as an example. The first stage is the era of CRT in the 20th century. In 1897, the first CRT in the world was born. The phosphor on the inner surface of the screen was excited by an electron beam to display images, realizing the conversion of electrical signal to light output. With the improvement of technology and technology, the industrialization of CRT technology began in the 1950s. Black and white CRT TV and color CRT TV have become the most important display devices in life. Although the cost of CRT is low and the CRT is limited by the picture tube, the size of CRT can only be 34 inches, which cannot meet the growing demand for large size.
The second stage, the turn of the 1990s era: rear projection technology, plasma technology, and liquid crystal technology parallel. The size of traditional CRT TV cannot meet the needs of consumers. Around 1990, manufacturers began to try various technologies to achieve larger display effect. Rear projection TV is based on the principle of projection and emission. The projector is installed at the bottom of the body, and the signal is projected to the back of the translucent screen by reflection. Although the rear projection TV had the advantages of large size and high brightness at that time, it was gradually eliminated due to its heavy body and bulb service life. The plasma tube is used as the light-emitting element in the plasma TV, the mixed gas is injected between two ultra-thin glass plates, and the phosphor is used to emit light and image by applying voltage. Despite the high definition of plasma TV picture, the phenomenon of screen burning cannot be solved, and it cannot become the mainstream of the next generation display.
The third stage, the 21st century LCD era: the early LCD TV was illuminated by the CCFL lamp inside the TV, which was limited by the size of the lamp, and the thickness of the TV was not ideal. After 2000, with the improvement of LCD technology, LED light-emitting diode as backlight reduces the size of LCD TV. At the same time, led backplane has obvious advantages in power consumption, which is more than 30% lower than traditional LCD TV. Since 2005, the cost of LCD TV has dropped sharply. At that time, the price war between manufacturers became more and more fierce, and the price of LCD TV dropped sharply: according to CNN news, the price of 32 inch LCD TV dropped sharply from US $1566 in 2005 to US $580 in 2008, which is equivalent to the price of CRT TV of the same size. In the same year, LCD TV accounted for more than 50% of China’s shipment for the first time, and became the mainstream technology in the display field.
From the evolution of display technology, we can see that high definition, large size, lightweight (portable) has been the main factors of consumer demand. In addition to meeting the needs of consumers at that time, sufficient performance advantages and long-term stability, the new generation display technology also needs to continuously reduce the cost and achieve competitive price in the process of industrialization, so as to have the opportunity to replace the existing mainstream display technology.
- Challenge: the development and bottleneck of emerging technology
As we mentioned earlier, the demand of the display industry is mainly portable flexible, large-scale and high-definition. At present, the emerging technologies explored by major manufacturers mainly include OLED, micro led direct display and other technologies.
Although micro LED has a high display effect, it still takes time to realize commercialization: Micro LED is a research hotspot in the display industry, and it is also one of the most potential display technologies in the future. However, there are some technical difficulties, such as mass transfer, packaging test, full-color, uniformity and so on. It is still in the research and development stage, and it is still a few years from commercial mass production.