Japan's V-tech supplies G8.6 generation line exposure machine to HKC Changsha

CINNO Rsearch Industry News: In the Chinese panel market, the Japanese equipment industry has launched a strategy to squeeze out South Korea. They have seized the position of South Korean companies by supplying panel equipment at ultra-low prices. Chinese manufacturers, who are constantly expanding their LCD and OLED production bases, are fueling this bloody competition between Japanese and Korean equipment companies by citing large-scale demand. The South Korean industry has called for improving its competitiveness as soon as possible in order to get rid of the squeeze from Japanese companies and ensure stable demand.

According to Korean media Etnews, HKC has selected Japan's V-tech for its 8.6-generation large-size OLED line H5 exposure machine in Changsha, Hunan.

HKC finally chose V-tech, which offered lower price, from the other Korean company. The Korean company that participated in the bidding was one of the core suppliers of the 8.6-generation LCD line H4. Although it reduced its price by about 20% to win the order, V-tech reduced its price by another 10% and finally won the order.

A person familiar with industry information said: It is common to adjust prices in order to win orders, but it is unusual for Japanese companies to offer such an extraordinary price cut. Nowadays, equipment demand is basically concentrated in China, and the pie is getting smaller and smaller. In fact, Japan's move is to launch a low-price offensive.

The South Korean industry believes that this is a "death strategy" aimed at blocking competitors, including South Korea, by hitting competitors with unmatched low prices.

Some people also analyzed that this strategy is mostly used by multi-category companies to leverage their advantages. V-tech should be selling exposure machines and other process equipment in a packaged combination at a reduced price. In this situation, the barriers to entry for Korean suppliers who mainly focus on a single category will become higher. In particular, companies with weak financial capabilities may even suffer a blow to their business foundations.

The way Chinese panel companies select suppliers is also a source of anxiety for Korean equipment companies. Every time a new factory is built, they have to use equipment from Japanese and Korean companies, which leads to continuous price cuts. Because Japanese companies have more accumulated technology in core processes such as exposure and evaporation than Korean companies, if Japanese companies adopt a low-price war, it will be even more difficult for Korean companies to enter the market.