Mitsubishi Electric decides to withdraw from LCD panel business; competition from Chinese manufacturers exceeds expectations

Following Samsung, Panasonic and other manufacturers, Mitsubishi Electric has also decided to withdraw from LCD panel production.

According to an announcement from Mitsubishi Electric, due to intensified competition and lack of profitability, its subsidiary Melco Display Technology Inc. (MDTI) will end TFT-LCD module (panel) production in June 2022 and terminate its LCD production business.

Mitsubishi Electric said that MDTI is currently mainly engaged in the research and development, manufacturing and sales of small and medium-sized LCD panels for electronic products/automotive use. However, due to the intensified price competition from overseas manufacturers such as China that exceeded expectations, it is difficult to make a profit in the production of LCD panels. It is judged that the competitiveness of products may be difficult to maintain under this circumstance, so it has decided to end production and withdraw from the LCD business.

It is understood that Mitsubishi Electric began mass production of LCD panels in 1996. The LCD business (excluding LCD TVs) that it plans to withdraw from this time had annual revenue of approximately 28.5 billion yen (RMB 1.88 billion) in 2019. Mitsubishi Electric currently purchases LCD panels for TVs from external companies. After discontinuing the production of the above-mentioned small and medium-sized LCD panels, Mitsubishi Electric will also purchase small and medium-sized panels required for its own products from external companies.

It is understood that MDTI was established in April 2002. The company is scheduled to be liquidated as a legal entity, and about 430 employees working in the company will also be transferred to power semiconductor and other departments. However, the company's factory in Kikuchi City, Kumamoto Prefecture, Japan, has not yet been decided on how to deal with it.

Currently, the majority of the global LCD panel market is controlled by Chinese manufacturers, including BOE and CSOT. In November last year, Panasonic announced that its subsidiary Panasonic Liquid Crystal Display (PLD), which is responsible for LCD panel production, will end its LCD panel production business in 2021, as the entry of Chinese panel "players" diluted product profits. This year, South Korean technology giants Samsung and LG have successively announced their intention to withdraw from the LCD business.