According to a report out of Korea last week, Samsung Display, the display panel maker for the giant conglomerate, has halted production of some of its Gen-8 LCD panel operations in South Korea, as it turns to its new Gen 11 LCD fab in China for LCD panel supplies.
A report posted by The eLEC website Friday said sources close to the situation indicated the move was part of a so-called “C Project,” involving a gradual shift away from LCD production towards OLED panel production at the Korean LCD lines. Samsung Display is expected to issue purchase orders for the necessary equipment in October, the report added.
Responding to our query on the matter, a spokesman for Samsung Display would not confirm the OLED production plans, saying only: “Samsung Display has been adjusting the production output and facility use of its Korean LCD operations due to oversupply and worsening profitability, and while we are considering the suspension of the line, nothing has been decided.”
The company would not comment further on the eLEC piece.
According the report, informed sources said Samsung had stopped its 8-1 line phase 1 in Samsung Display’s Asan 1 Campus in South Chungcheong Province. That line had been in operation since 2007, and at the time was part of a joint venture between Samsung and Sony. The Gen-8 lines in the Asan 1 Campus include the 8-1 and 8-2 lines, which are each divided into phase 1 and phase 2.
Samsung Display reportedly next plans to shut down the rest of the Gen-8 lines, in addition to the remaining 7-2 lines, which were left after previously switching over some lines to produce small and mid-sized OLED panels.
Eventually, the display maker is expected to completely end LCD panel production on its native soil, the report concluded.
Elsewhere in Asia, Samsung Display operates Gen-8 LCD production lines in China’s Suzhou City. Samsung owns a 60% stake in the production corporation SSL, in which Suzhou City government owns another 30%. The remaining 10% is owned by Chinese display maker CSOT (a TCL company).
If Samsung Display does, indeed, halt all of its Korean LCD production, it is expected to be able to secure all the TV LCD panels it needs from its Chinese lines and CSOT.
According to eLEC, Samsung Display holds a 9.8% stake in CSOT’s Gen-11 LCD line production.
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The Gen-11 LCD lines at CSOT began mass production in the first quarter of this year, with the goal of increasing output capacity to a maximum of 90,000 panels per month by the end of the year. About a tenth of the panels produced at the fab are earmarked for Samsung Display, the report said.
Futher, the report pointed out that on the day Samsung display partially halted its Gen-8 LCD lines, South Korean display equipment maker ICD said in a regulatory filing that it has entered into a supply contract with Japanese panel deposition equipment maker Canon Tokki.
This was pointed to as a red flag indicator, the piece said, that Samsung Display has agreed to install deposition equipment for its large-sized TV OLED panels. ICD has been supplying logistics chambers for Canon Tokki’s small and mid-sized panel deposition equipment.
Again, Samsung Display would not confirm any of that.
By Greg Tarr
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