"Opportunity Always Follows Crisis"…Samsung Display Strengthens Quantum Dot Equipment

Expansion of Large OLED-Based QD Production Line
Contracts Worth a Total of 444 Billion KRW with 12 Major Partners

Samsung Display, Major Partner Contract Status Over the Past 3 Months

[Asia Economy Reporter Dongwoo Lee] Despite the impact of the novel coronavirus disease (COVID-19), Samsung Display is strengthening its facility investments for mass production of Quantum Dot (QD) displays next year. The company plans to phase out its existing 8th-generation liquid crystal display (LCD) lines by the end of this year and rapidly transition to a large-sized QD display business based on organic light-emitting diode (OLED) technology. This is also interpreted as a proactive investment to seize the opportunity of expanding display demand that will arise after COVID-19.

According to industry sources on the 21st, Samsung Display signed display equipment supply contracts worth a total of 444 billion KRW with 12 major partners over the past three months, from the end of last year to last month. This is part of the blueprint in which Samsung Electronics Vice Chairman Lee Jae-yong plans to invest a total of 13.1 trillion KRW in the large-sized display business by 2025 as part of a super-gap strategy.

Among Samsung Display’s partners, Pileoptics, a manufacturer of flat panel displays and printed circuit boards, signed equipment supply contracts worth a total of 81.2 billion KRW during this period. Pileoptics is mainly known for supplying display substrate laser cutting equipment to the company. They signed five contracts with Samsung Display and its Vietnam subsidiary every month, including 22.6 billion KRW last month, 6.9 billion KRW in February, 16.3 billion KRW in January, and 35.4 billion KRW in December last year.

For supplying machinery for flat panel display (FPD) manufacturing, Samsung Display also signed contracts worth 69.4 billion KRW at the end of last year and 11.2 billion KRW in February this year with FNS Tech, totaling 80.6 billion KRW. They agreed to receive display manufacturing equipment worth 67.6 billion KRW from Wonik IPS by August this year. Roche Systems (62.1 billion KRW), HB Technology (59.5 billion KRW), and ICD (22.5 billion KRW) also signed equipment contracts mainly for setting up QD display lines, each ranging from 20 billion to 60 billion KRW.

In particular, Samsung Display signed three supply contracts totaling 8.9 billion KRW last month with HIMS, a company mainly manufacturing and selling OLED display process equipment. Additionally, they agreed to receive display equipment necessary for production processes, such as atomic microscopes, from DIIT (16.6 billion KRW), TSE (13.8 billion KRW), Youngwoo DSP (12.9 billion KRW), JSTech (8.6 billion KRW), and Park Systems (1.7 billion KRW).

Considering that most of the contracts signed until last month are set to expire in August, it is expected that the basic setup of the 'Q1 line' for mass production of QD displays at the Asan campus in Chungnam will be completed within the first half of the year.

Samsung Display plans to enter the test operation phase of the QD display production line in the second half of the year and start full-scale mass production as early as the first half of next year. The Q1 line aims to produce 30,000 panels of 65 inches or larger in the first phase.

Industry insiders evaluate Samsung Display’s move to strengthen its next-generation QD display business as scheduled despite the increased management uncertainty caused by COVID-19 as a proactive response to the opportunities after the 'Post-Corona' crisis.

Participants of the COVID-19 response industry meeting held by the Korea Chamber of Commerce and Industry (KCCI) with the IT industry near Gwanghwamun, Seoul, on the morning of the same day also agreed that proactive preparation for opportunities after COVID-19 (Post-Corona) is necessary.

Seokwang Hyun, Executive Vice President of the Korea Display Industry Association, said, "In a situation where Korea has already been overtaken by China in the LCD market, Korea must maintain leadership in the OLED market where it has technological superiority," and requested, "The government should boldly support the development of innovative technologies by expanding tax credit targets for new growth research and development."

Woo Tae-hee, Executive Vice President of KCCI, said, "It is fortunate that Korea’s main industry, the IT sector, is holding up amid the COVID-19 crisis," but added, "To prevent companies from falling into difficulties due to COVID-19, restrictions on overseas travel for businesspeople and difficulties in testing and certification must be promptly resolved."

This content was produced with the assistance of AI translation services.