Jabil's Global Mechanicals Intelligence Archive

Global Mechanicals Intelligence

Q4 2024 | OCTOBER - DECEMBER

MARKET DYNAMICS

• By 2030, the penetration rates of OLED with LTPO backplanes, LTPS TFT LCD, OLEDoS, and Micro-LEDoS will increase in all display applications. Automotive displays have many different sub-applications, such as instrument cluster display (ICD), central infotainment display (CID), rearview mirror, head-up display (HUD), rear seat display, passenger display, and so on. Each display has different requirements.
• Currently, a-Si TFT LCD has a high penetration rate. Still, LTPS TFT LCD will gradually replace a-Si TFT LCD, owing to its lower power consumption and more straightforward structure or form factor.
• On the other hand, the penetration rate of OLED displays should increase with the rise of electric vehicles (EVs). By 2030, Micro LEDs may also have minor penetration in high-end luxury cars, offering high brightness, transparency, and toughness for differentiation.
• Following inventory clearance, shipments of near-eye displays are expected to increase year over year over the next few years. OLEDoS is anticipated to dominate the high-end VR/MR market, with its technological share rising to 23% by 2030, while LCD will continue to occupy the mainstream market, holding a 63% share in near-eye displays.
• OLED's share of smartphone screens is expected to reach 56% by the end of 2024, making it the dominant screen technology in the smartphone market. Upgrading screens with FHD resolution and above to OLED has become a consensus among various brands.
• Micro-LED display developer VueReal announced a strategic partnership with PMOLED producer RiTDisplay display, enabling device makers to access VueReal's micro-LED display technologies.
• The two companies will target the consumer market with high-performance, cost-effective displays based on RiTDisplay’s passive-matrix backplane and VueReal’s micro-LED front-plane solutions.

TECHNOLOGY OVERVIEW

LCD (LIQUID CRYSTAL DISPLAY)

Mini-LED Backlighting

• This technology uses thousands of tiny LEDs as the backlight source, offering improved local dimming and contrast compared to traditional LCDs. It results in deeper blacks, brighter highlights, and a wider color gamut, bringing LCD performance closer to OLED.

Quantum Dot Enhancement Films (QDEF)

• QDEF technology utilizes quantum dots to enhance LCD’s color accuracy and brightness.  This results in more vibrant and realistic colors, particularly in the red and green spectrum.

High Refresh Rate Displays

• LCD panels are now available with refresh rates up to 360Hz, providing smoother visuals and reduced motion blur, which is especially beneficial for gaming and fast-action content.

Foldable and Rollable LCDs

• Research is ongoing to develop flexible LCDs that can be folded or rolled up, offering new possibilities for smartphone and tablet designs.

OLED (ORGANIC LIGHT-EMITTING DIODE) DISPLAYS

QD-OLED (Quantum Dot OLED)

• This hybrid technology combines OLED’s self-emissive nature with quantum dots for color conversion, resulting in an even wider color gamut and improved brightness than traditional OLED displays.

MicroLED Displays

• MicroLED technology utilizes microscopic LEDs as individual pixels, offering exceptional brightness, contrast, and color accuracy. While still in its early stages, MicroLED has the potential to outperform both LCD and OLED in the future.

Transparent and Flexible OLEDs

• Advances in OLED technology enable the development of transparent and flexible displays, opening up new possibilities for applications in augmented reality, signage, and wearable devices.

Inkjet-Printed OLEDs

• This emerging technology aims to streamline OLED manufacturing by using inkjet printing to deposit organic materials, potentially reducing costs and enabling large-scale production of flexible displays.

RECENT DEVELOPMENTS

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

 DEMAND COMMENTARY

• The global AMOLED mobile phone panel shipment volume increased by 50.1% year-on-year in 1H24, per CINNO Research, Samsung 44%, BOE 16%, VISIONOX 11%, CSOT 10%, TIANMA 9%.
• Mini-LEDs are expected to enjoy the highest penetration in Automotive from 2026.
• TrendForce forecasts the market value of Micro LED chips to reach USD 580 million in 2028, with an 84% CAGR from 2023 to 2028. Following the rapid, comprehensive, and widespread development of AI assistant functions in recent years, the demand for Micro LED displays as part of AR glasses will gradually emerge in the next 1 to 2 years.
• Due to the overall environmental impact, the shipment volume of industrial displays is expected to increase by 0.4% annually to 193 million pieces in 2024.
• The top five panel manufacturers are expected to ship 165 million pieces by 2024, accounting for 85% of the total shipment volume of industrial displays.
• From a revenue perspective, panel factories are gradually moving towards vertical integration, so industrial displays are expected to increase by 12% to $2.9 billion in 2024.

SUPPLY ANALYSIS

• Premium notebook PC panels continuously lost their market share to OLED notebook PC panels.
• The AMOLED supplier EVERDISPLAY stated that revenue is expected to exceed expectations in the first half of this year.
• TIANMA's $164 million pilot micro-LED production line in Xiamen started trial production. TIANMA also detailed the first micro-LED display produced at the new plant, a 7.5" module aimed at tiled displays that offer a brightness of 600 nits and a low 5% reflectance.
• LG Display announced on August 1 that it had selected China Star Optronics Technology (CSOT) as the preferred negotiating partner to sell its share of its Gen 8.5 LCD fab in Guangzhou, China.
• The E-paper industry sees a colorful boost. The e-paper industry is transforming significantly as it shifts from monochrome to color displays, triggering a replacement cycle for end products and boosting performance across the supply chain.

PRICING SITUATION

• LCD TV panel prices will remain in a soft decline for the next few months while sustaining within a narrow range.
• Currently, the prices of mainstream monitor panels are still under cash costs, and money is lost. However, panel makers that adopted low-cost components from Chinese vendors did earn some profits.
• Overall, monitor panel prices to be flat, though some panel makers may continue asking for panel price increases to reach their cash cost levels for the mainstream models.
• In the tablet PC market, with Chinese module makers continuing to offer lower prices, the prices of tablet PC panels will continue decreasing. Demand-wise, only  'Apple's iPad product lines are expected to be good.
• As for the small-medium size display market,
• Regarding a-Si, the demand for brands improved in August, and module factories are experiencing stable prices after months of low-price competition. As a result, some low-priced projects will remain low after experiencing multiple months of price declines and will not continue to decrease.
• Terminal demand for LTPS continues to be weak, and at the same time, pressure from AMOLED panels is eroding the market. Panel factories are experiencing intensifying inventory pressure, and the main LTPS production line is operating loosely, resulting in a continued price decline.
• Regarding AMOLED, the price of rigid AMOLED panels has stabilized after successfully increasing under the strategic adjustment of the foremost manufacturer, Samsung Display (SDC). The supply and demand of flexible AMOLED panels are loose, and the overall price will continue to decline, but the decline will narrow.

KEY TAKEAWAYS

• Market Overview:
  • The fourth quarter typically sees a seasonal uptick in demand due to holiday sales, but an oversupply situation with high channel inventories currently characterizes the market.  This has led to a cautious approach by panel manufacturers, resulting in a "peak season without peak" scenario. Despite the increase in traditional demand, the market is expected to remain challenging due to the need to clear existing inventories.
• Supply:
  • Panel makers are proactively adjusting their strategies to effectively cope with the demand corrections. 
  • Some are considering reducing supply or adopting a production-to-order approach to retain their bargaining power on panel prices. Others are contemplating offering price concessions to strategic customers to maintain market share.
  • There is also concern about the potential impact of LG Display selling its LCD fab in China, which could intensify competition among leading panel makers in the region.
• Demand:
  • While the holiday season is expected to increase demand, the market faces challenges such as oversupply, high inventories, and cautious purchasing behavior from TV and monitor makers.
  • The demand for notebook PC panels is expected to be stable, with potential growth in the tablet PC market driven by Apple's new releases. Strategic pricing and support from panel makers will be vital in navigating the demand landscape in the fourth quarter.
• Price Trends:
  • CINNO Research predicts that a-Si/LTPS prices will continue to decline through August and September, with a-Si panels dropping by $0.1 per month and LTPS panels by $0.2 per month. Rigid AMOLED panels are expected to remain relatively stable, while the decline in flexible AMOLED panels is expected to slow to $0.5 per month.
  • Overall, the declining price trend will likely continue into the fourth quarter, with panel makers facing pressure to lower prices to support their customers' profit margins and maintain market share.
• In summary, the fourth quarter of the display market is expected to be characterized by a cautious approach to inventory management, with panel and TV makers making purchases more cautiously and potentially lowering buying plans.
• The market will likely see continued price declines across various display types, except rigid AMOLED panels, which are expected to remain stable.  Panel makers must navigate this period by adjusting their supply strategies and considering price concessions to strategic customers.