Samsung gradually withdraws from the LCD market, and the two panel giants may play a key role in the supply chain

Samsung Group recently announced the list of the top 100 supply chains in 2020. A total of 6 Taiwanese manufacturers made the list, the same as last year. Among them, the two panel giants AUO and Innolux supply Samsung LCD panels. As Samsung Display (SDC) has gradually withdrawn from the LCD market in recent years and expanded its layout in the OLED market, the role of Taiwanese manufacturers is expected to become more important.

Samsung's LCD panels used to be mainly provided by its subsidiary Samsung Display. However, due to the rise of China's panel industry in recent years, the LCD industry has suffered from price competition. Therefore, Samsung Display has decided to gradually withdraw and turn to the development of OLED, and expand its LCD cooperation with Taiwan and mainland panel manufacturers, including AUO, Innolux and BOE.

The two panel giants have continued to adjust their operating structures in recent years and expanded their layout in the high-end panel market. AUO is currently Samsung's high-end TV panel supplier, supplying Samsung 8K TVs and other panels.

As panel prices have stabilized and risen since the middle of last year due to remote business opportunities and the stimulus of the stay-at-home economy, Korean panel manufacturers have postponed their LCD plant closure plans several times. In the middle of this year, it was reported that Samsung Display's LCD plant closure plan will be extended to next year, but it is observed that Samsung Display currently has only one 8th generation LCD plant in South Korea that is still in production, and the withdrawal of Korean manufacturers from the LCD market is a foregone conclusion.

The market expects that in the future, the LCD panels needed by Samsung will be mainly shared by manufacturers in China and Taiwan. Taiwanese manufacturers have maintained good supply chain partnerships with Korean manufacturers in the past and are expected to play a further important role in Samsung's supply chain in the future.

According to the list of the top 100 supply chains released by Samsung last year, in addition to the two panel giants, the backlight module giant Coretronic also provides Samsung backlight module products. Others include MediaTek, Tripod Technology, and Chichao.