Samsung has postponed its plans to shut down the LCD business to March 2021. The company was previously preparing for a complete shutdown of LCD production by the end of this year. However, it now plans to continue production at its L8 fab in the Asan plant for at least three more months.
According to a report by ET News, the rise in demand for LCD panels during the ongoing COVID-19 pandemic, which has forced more people to work, entertain, or learn from home, is the reason behind this change in plans. Samsung has reportedly informed all the concerned companies about this development.
Samsung has been producing LCD panels at its Asan plant in South Korea and its Suzhou plant in China. The company has already reached a deal with CSOT (China Star Optoelectronics Technology) to sell the Suzhou plant. It has also reportedly sold some of the equipment from its Asan plant to Efonlong, another Chinese display manufacturing firm.
The Korean company is now in talks with two more Chinese firms to sell the remaining equipment. It is hopeful of reaching a deal by February 2021 and shut down the LCD production by March.
Samsung to shut down the LCD business in March 2021
Samsung has been in the LCD business since the early 1990s. However, the Korean behemoth started scaling down LCD production in 2016 when it shut down as many as six LCD plants to make room for OLED production.
Earlier this year, Samsung Display, the company's display manufacturing division, reassigned more than 200 employees to its other divisions. All this pointed towards an impending shutdown of the LCD business.
The plan was to completely stop manufacturing LCD panels as early as this year as the company shifts focus to Quantum Dot LED panels (QLED). Although the plan has been slightly delayed, Samsung still sees QLED as the next-generation large display technology.
Starting the second half of next year, Samsung is expected to produce 30,000 QLED panels per month. To put that into perspective, it's enough for just about 180,000 55-inch TVs per month (considering a 100 percent yield), or two million 55-inch TVs per year. However, industry experts believe Samsung's production capacity will improve greatly as it speeds up its investment in the technology.
Nearly 200 million TVs are sold globally every year. So Samsung will have to exponentially increase its QLED production capacity over the next few years to stay competitive. It has committed to invest around $11.7 billion in this display technology until 2025.