07Nov
According to LG's plan, the LCD panel factory in Guangzhou should be completely closed by the end of the year, or simply sold to a domestic manufacturer. Before, we speculated whether Skyworth, which has a good relationship with LG, or some other manufacturer would acquire it. But it looks like things have changed now. At least from what we know, LG no longer plans to sell the LCD panel factory in Guangzhou, and plans to restart it and restore 100% production capacity.
This is indeed a somewhat surprising decision, because LG announced very early that it would completely shut down its LCD panel factory and fully support OLED and Micro LED technologies. Now LG has stated that its panel factory in Guangzhou will officially restart in January next year and restore 100% production capacity in April. In this way, LG can produce 15 million TV LCD panels next year, which are LG's own IPS panels. This can not only be adapted to LG's own LCD TVs, but also provide some IPS panels to Samsung, which has been in trouble with BOE during this period. It is very stiff and has been reducing the number of panels purchased from BOE.
The reason why LG wants to restart the Guangzhou panel factory is mainly due to two reasons. First, the price of LCD TV panels has increased significantly, and the profits seem to be lucrative. Since LG has not sold the Guangzhou panel factory, it can take advantage of it. , it is only natural that you can make more money on the LCD panel. After all, BOE’s LCD TV panels have increased in price by 50% compared to their lowest point. Now that LG has re-entered the market, it can be considered as a good opportunity to seize the opportunity.
Another reason is that LG’s OLED TV shipments this year have not reached the ideal state. Originally, LG expected the shipment volume of its own OLED TVs to reach 6.8 million units in 2023. However, due to the sluggish market and economic downturn, coupled with the entry of Samsung, which has intensified the competition of OLED TVs, LG expects that its own OLED TV sales this year Shipments can only reach 5 million units, which is obviously a big gap from the previous estimate of 6.8 million units.The loss of shipments of 1.8 million units means that for LG's TV and panel departments, revenue will shrink, so LG also needs to open source other parts. At present, LG's home appliance profits have doubled and its development is good. The revenue from automobile-related solutions is not small. Adding revenue from an LCD panel next year is also a good way out. At least developing OLED and LCD TV panels at the same time, it is always a good idea to be prepared for both.
However, for LG, OLED is definitely the focus. The OLED market next year will probably grow by 10%, which is also in line with LG's development direction towards high-end and high profits. However, several large TV markets still have considerable demand for LCD panels, so LG's restart of the Guangzhou factory seems more like making a quick buck. As for how long this factory can be retained, it depends on LG's own ideas. Or let’s see if we can find a buyer in China.
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