Chongqing Huike Jinyu arranges monthly vacation for annual salary employees

It was reported that Chongqing HKC Jinyu Optoelectronics Technology Co., Ltd., a LCD panel manufacturer, recently issued a mandatory leave notice, requiring annual salary employees to take five days of unpaid leave each month from July 1 to December 31.

It is reported that the 8.5+ generation thin-film transistor liquid crystal display device project of HKC Jinyu Optoelectronics was jointly funded and constructed by HKC Electronics, Chongqing Yufu Group and Chongqing Banan Economic Park Construction Co., Ltd. in July 2016, with a total investment of 24 billion yuan; this is the first LCD panel production project in my country led by a mixed-ownership enterprise, and the second LCD panel project put into production in Chongqing after BOE's 8.5-generation line. It adopts a-Si (amorphous silicon, i.e. A silicon) technology, with a monthly output of 70,000 glass substrates (size 2250*2600mm), and an annual output value of approximately 11 billion yuan after reaching full production.

The 8.6th generation LCD panel project of Chongqing HKC Jinyu Optoelectronics was put into production on February 27, 2017, and the cumulative shipments reached one million pieces by November of that year. At the 2019 International New Display Technology Exhibition held in Shanghai at the end of June this year, Chongqing HKC Jinyu Optoelectronics demonstrated its Fission Cell technology, which can truly achieve double the resolution, color saturation, color depth and dynamic response rate of the component. Compared with the thousand-level partitions provided by the current LCD screen combined with mini LED, HKC technology can present million-pixel local dimming pixel partitions, reaching the industry's ultimate level. Its 8ms ultra-short response time, 500000: 1 ultra-high contrast ratio and 95% NTSC ultra-wide color gamut lead the LCD display effect to a new height.

As one of the main players in the domestic large-size LCD panel market, HKC's production line has been put into operation since March 2017. In 2017, the annual shipment of 32-inch panels alone was 5.06 million pieces, and in 2018, the annual shipment of 32-inch panels was 9.64 million pieces, with huge sales. In terms of market share, the global market share of 32-inch panels produced by HKC in the same-size TV LCD panel has increased from 0.86% in March 2017 to 10.35% in December 2018, a market share increase of more than 12 times.

However, HKC, which has been developing well, has been embroiled in a series of patent disputes in recent times.

In February this year, Innolux filed a total of 17 patent infringement lawsuits with the Guangzhou Intellectual Property Court and the Ningbo Intermediate People's Court of Zhejiang Province, accusing HKC Jinyu of infringing its patent rights.

Subsequently, HKC Jinyu filed a request for invalidation of the 17 patents filed by Innolux with the Patent Reexamination Board of the State Intellectual Property Office (hereinafter referred to as the Patent Reexamination Board).

On April 26, 2019, Shenzhen China Star Optoelectronics Technology Co., Ltd. filed a patent infringement lawsuit against HKC in the Shenzhen Intermediate People's Court. The lawsuit involved three of China Star Optoelectronics' patents in the liquid crystal display field, and the amount of compensation was in the tens of millions of yuan.

The latest news shows that the China Intellectual Property Office has made a decision on the invalidation request review for HKC's patent numbers "ZL201611179077.5" and "ZL201720606454.2". So far, all five patents filed by HKC against Innolux have been declared invalid. HKC's counter-patents have been completely wiped out, which puts it in a very unfavorable position in the next patent lawsuit against Innolux. HKC seems to be in a very disadvantageous position.

In recent years, as the LCD industry in mainland China has developed rapidly, the competition model of technology companies has long changed from traditional price wars and service wars to patent wars. Similar patent disputes seem to be patent infringements, but behind them is fierce competition in the market. On the other hand, Sino-US trade frictions have also had an impact on large and medium-sized LCD panels.

According to TrendForce Optoelectronics Research (WitsView), the price of medium and large-sized LCD monitor panels is unlikely to stop falling in the third quarter of 2019. The main reason is that due to the continued impact of the Sino-US trade war in the second quarter, some LCD monitor brand manufacturers have already stocked up in advance, while increasing the inventory of complete machines in North America. In addition, the original panel and complete machine inventory on the hands of brands was already high due to poor demand, causing brand manufacturers to reduce the panel procurement volume in the third quarter, resulting in a decline in stocking momentum during the third quarter peak season.

TrendForce said that in June, the price of 32-inch panels fell by more than $4 to $36 amid low demand and high inventory. From the supply side, BOE, one of the major suppliers, reduced its 32-inch production in an attempt to ease the pressure of price cuts. Meanwhile, Innolux lost orders for 58-inch panels produced on its 5.5-generation line because it could not compete with the low-price volume of China Electronics Corporation (CEC). Innolux responded by increasing its 32-inch production.

It is not clear whether HKC Jinyu forced its employees to take leave because the company's performance has been affected by a series of patent disputes and market weakness. Jiwei.com will continue to pay attention to this.