cens logo

Innolux and AU Optronics to Start up New LTPS Production Capacity in 2016: WitsView

Dec 07, 2015 | By CENS

The expanding shipments of low temperature poly-silicon (LTPS) thin film transistor-liquid crystal display (TFT-LCD) panels have been raising the penetration of full high-definition (FHD)-screen smartphones to about 25 percent, from about 18 percent in early 2015, according to WitsView, a market research division of TrendForce.

WitsView also predicts this year's global LTPS production capacity by area will reach about 9.4 million square meters, with that in 2016 to top 10.7 million square meters. 

Both Innolux Corp. and AU Optronics Corp. (AUO), recognized as the top-two TFT-LCD panel suppliers in Taiwan, are scheduled to start up their new LTPS capacity in 2016 to tap more business opportunities in the smartphone-application market. But, WitsView says, the continuously falling LTPS-panel prices are expected to undermine panel suppliers' profitability.

Boyce Fan, senior research manager of WitsView, points out that major LCD panel makers have been continually investing in new fabs to produce LTPS LCD panels since 2013, to capture demand in the high-end smartphone market. However, with capacity expansions to continue in 2016, WitsView expects no relief from the oversupply situation and further squeezing of margins of LTPS products.

news-photoFHD-resolution smartphone models is forecast to account for at least 25 percent of the overall market in 2016. (An LTPS smartphone panel from AUO shown)

Innolux & AUO
Innolux, recognized as the largest TFT-LCD panel maker in Taiwan, is installing equipment and carrying out trial production at its sixth-generation (6G) LTPS panel factory in the Southern Taiwan Science Park (STSP), where it is scheduled to kick off mass production in the first quarter of 2016.

AUO is also scheduled to start mass production of LTPS panels in 2016, at its factory in Kunshan, Jiangsu Province of China, in the second half of next year. The company says that it has been suffering insufficient supply of LTPS panels, and the Kunshan LTPS factory is expected to be very competitive in the business.

Industry sources say that these two major Taiwanese panel suppliers used to lack LTPS production capacity, but their new factories are expected to help increase shipments of high-end cellphone panels from 2016.

Trends in Slowing Smartphone Market
Fan points out that the 2015 global smartphone market will undergo slowing growth, with the growth rate not to be double-digits as before. The market's growth momentum will shift from shipment volume to specs upgrades, he adds, such as increasing display sizes (5-inch and larger), upgrading display resolution (HD and FHD), and more advanced (such as the in-cell touch display that has become a prevalent feature in high-end smartphones).

The research manager also outlines three major trends developing in the smartphone-panel industry in 2016. The first, he says, is  the smartphone panel market will undergo  another round of shakeout as expansions in LTPS capacity drive down panel prices.

In the LTPS panel market, Fan explains, Japanese and South Korean suppliers currently have the advantages in both shipments and technology. However, their leads will wane as other panel makers have been aggressively trying to elevate LTPS capacity. The slowdown in the smartphone market and the increase in the overall LTPS capacity will, Fan notes, soon spark a price war that may result in another of shakeout in the panel market. The winners of this competition will be players who can achieve high yield rates at their LTPS fabs earlier than others, coupled with having the cost and pricing advantages in the initial stage. By owning the advantage of lower prices is crucial to dominating the oversupplied LTPS panel market, since this advantage will further help secure loyalty of clients and expand channels of consumption.

The second trend is the share of FHD-resolution smartphones worldwide will continue to grow in 2016. Fan says that HD-resolution is now the prevailing display spec for entry-level smartphones, while the prices for HD-resolution smartphone panels have touched bottom. Therefore, the core display spec of mid-range and high-end smartphones has shifted to FHD. FHD resolution will be higher than 400 PPI (pixels per inch), and LTPS is suited for the production of such panels. Panel makers with LTPS fabs are thus potential suppliers of mid-range and high-end smartphone panels, says Fan.

Though the number of LTPS panel suppliers is still very limited, these companies have begun to cut their FHD-product prices since early 2015, so as to capture market share and strengthen relationships with clients, Fan says. As a result, later entrants to the LTPS market will face enormous challenges in staying profitable in the competition. At the same time, branded smartphone vendors will release more devices featuring FHD displays. By resolution specs, Fan estimates that FHD models will account for 18 percent of the smartphone market this year, and this share will increase significantly to at least 25 percent in 2016.

news-photoAlternative high-resolution display technologies compete against LTPS. (photo of AUO's 5.5-inch FHD, a-Si smartphone display with high resolution, brightness and low power consumption)

Alternative Technologies
Smartphone suppliers, however, are using other alternative display technologies instead of LTPS to grab more business opportunities created by higher-resolution demand.  These alternative display technologies include a-Si (amorphous silicon) LCD, oxide TFT-LCD and AMOLED (active-matrix organic light-emitting diode).

Samsung Display Corp. (SDC) has made steady progress in supplying AMOLED panels to customers outside of the Samsung brand this year and is expected to expand its effort in this area in 2016, squeezing the shares that LTPS panels have in the mid-range and high-end smartphone markets. More suppliers with different technologies also means intensifying price competition in the FHD smartphone panel market.

The third trend in the global smartphone-display market is narrow bezels and flexible panels, which will inspire new smartphone designs.

According to Fan, exterior and stylish designs have been a major area of competition in the smartphone market, and that is expected to be even more crucial in the next few years. Narrow-bezel has emerged as a design trend in recent years, and the frames around smartphone screens are expected to become much thinner (with borders of some panel modules being less than 1mm). Another source of design innovation comes from AMOLED panels, which are light and thin as well as offering high color saturation, as well as enabling the creation of flexible displays. Samsung's Edge series, for example, has smartphones that features AMOLED displays that curve to the edges. On the whole, the market scale for flexible display design is expected to grow further next year.


Industry In-Focus

Latest Chinese-U.S. Trade Talks Mark Chance of Higher-Level Meetings and Ease Market Tensions</h2>

Latest Chinese-U.S. Trade Talks Mark Chance of Higher-Level Meetings and Ease Market Tensions

Jan 14, 2019

The world waited with bated breath as Chinese and U.S. representatives met during this week to deliberate over whether the trade war would finally come to a reasonable conclusion. Throughout the entirety of the trade war early last year, from escalation to the tentative 90-day truce borne from the G20 Summit in Argentina between President Xi Jinping and U.S. counterpart President Donald Trump...


Taiwan Firms Kicks off 2019 at ArabPlast </h2>

Taiwan Firms Kicks off 2019 at ArabPlast

Jan 10, 2019

The biannual ArabPlast 2019 is marked as the most indicative benchmark as the largest trade expo for plastics, petrochemicals and rubber industry in the MENA region. The show kicked off on Jan. 5, attracting 336 exhibitors from 27 countries. Taiwanese exhibitors also attended, led by Taiwan Association of Machinery Industry in a 34-member strong delegation, a size just shy of China and India. ...


ARTC Teams Up With 18 Companies to Form Self-Driving Vehicle Union</h2>

ARTC Teams Up With 18 Companies to Form Self-Driving Vehicle Union

Dec 28, 2018

November 20 marks a huge milestone in Taiwan’s self-driving industry. The Automotive Research & Testing Center (ARTC) joined hands with 18 brands, including Acer ITS Inc., Global UniTek, Shin Wei Automotive Industrial and others of Taiwan’s top-to-bottom industrial chain to form the Autonomous Vehicle Industry Alliance. Their overall aim is to shore up support for a new, innovative operation m...



Industry Reports

Latest Chinese-U.S. Trade Talks Mark Chance of Higher-Level Meetings and Ease Market Tensions</h2>

Latest Chinese-U.S. Trade Talks Mark Chance of Higher-Level Meetings and Ease Market Tensions

Jan 14, 2019

The world waited with bated breath as Chinese and U.S. representatives met during this week to deliberate over whether the trade war would finally come to a reasonable conclusion. Throughout the entirety of the trade war early last year, from escalation to the tentative 90-day truce borne from the G20 Summit in Argentina between President Xi Jinping and U.S. counterpart President Donald Trump...


ARTC Teams Up With 18 Companies to Form Self-Driving Vehicle Union</h2>

ARTC Teams Up With 18 Companies to Form Self-Driving Vehicle Union

Dec 28, 2018

November 20 marks a huge milestone in Taiwan’s self-driving industry. The Automotive Research & Testing Center (ARTC) joined hands with 18 brands, including Acer ITS Inc., Global UniTek, Shin Wei Automotive Industrial and others of Taiwan’s top-to-bottom industrial chain to form the Autonomous Vehicle Industry Alliance. Their overall aim is to shore up support for a new, innovative operation m...


An Alliance Between Ford and VW Could be Announced as Early as Next Year</h2>

An Alliance Between Ford and VW Could be Announced as Early as Next Year

Dec 11, 2018

There is news of a far-reaching alliance between Ford Motor and Volkswagen, according to those familiar to the matter, reported CNBC. The two world’s largest automakers plan to announce the alliance next January, a partnership that would encompass sharing assembly plants in the U.S. to avoid new the wave of tariffs, joint marketing and distribution as well as product development, possibly on t...



Supplier News

Antrc Industrial Corp. offers bumpers, parts, decoration strips, skid plates, radiator, radiator grill, headlights and rear lights and will be exhibiting at Automechanika Shanghai to tap into the Asian markets. (photo courtesy of Antrc Industrial Corp.)

Antrc Industrial Corp. Aims for High-End Auto Parts Industry for Asian Markets

Dec 05, 2018

Antrc Industrial Corp. focuses on manufacturing plastic parts, metal parts and other automotive parts in the aftermarket industry. The firm can roll out parts and products that match with customers’ needs and the industry pulse in this changing and competitive market. Having deep roots in the AM industry, Antrc can deliver with its complete supply chain, from designing, molding making and finally...

ANTRC INDUSTRIAL CORP.


NHC and YangPo products satisfy demands for different automobiles. (photographed by Tseng Lung-nan)

Brake Maker Nan Hoang Rides on Biz Upswing to Offer More Clients the Best

Dec 04, 2018

For more than five decades, Nan Hoang Traffic Instrument Co., Ltd (NHC) has been one of the major manufacturers of specialty vehicle friction materials in Taiwan and around the world. Chairman Austin Cheng has been carrying out their “double-arrow developing plan” for this year. In one aspect, through its private label YangPo, NHC aims to adopt a more effective marketing strategy for selling own-...

NAN HOANG TRAFFIC INSTRUMENT CO., LTD.


Intime offers high-quality performance brake calipers. (photo courtesy of Intime)

Intime's Products Sought-after by Professionals Worldwide

Dec 04, 2018

Founded in 2013, Intime Auto Parts Co., Ltd., specializes in making performance brake calipers and performance shock absorber systems. Intime takes pride of its “n&b performance” series. The firm's n&b ceramic brake pads, which are made of low metallic NAO material, is capable of functioning without damaging the brake discs. Also notable is that the brake dust can be removed easily from the al...

INTIME AUTO PARTS CO., LTD.



Insiders' Views

Megvii Technology Founder and CEO Tang Wenbin

Part 1 Megvii Technology Founder Interview: Face++ AI Facial Recognition sets eye on Asia, starting with Taiwan

Sep 07, 2018

Using facial recognition to remove security checks and recognizing criminals sounds like technological applications out of a movie, though much of it is already implemented in everyday life. Having been founded for only seven years, Megvii Technology Limited, or more commonly known for its facial recognition and AI application Face++, owns critical technology by combining both, and now, recently ...

FOXCONN TECHNOLOGY


Megvii Technology Founder Interview Part 2: Face++ AI Facial Recognition sets eye on Asia, starting with Taiwan</h2>

Megvii Technology Founder Interview Part 2: Face++ AI Facial Recognition sets eye on Asia, starting with Taiwan

Sep 07, 2018

Tang Wenbin, founder and CEO of Megvii Technology, will be visiting Taiwan next week, but accepted an overseas interview with Economic Daily News on Sept. 6. This is the second installment of the interview. Aiming for a complete application; forming a city’s “brain” Q: What are the goals and strategy for the next phase? A: When the company first started off, we had to find a way to impl...

FOXCONN TECHNOLOGY


MPN's Editor-at-large Provides Holistic, In-depth Insights into U.S. Market for Powersports</h2><p class='subtitle'>Industry veteran suggests Taiwanese suppliers establish market presence as priority</p>

MPN's Editor-at-large Provides Holistic, In-depth Insights into U.S. Market for Powersports

Industry veteran suggests Taiwanese suppliers establish market presence as priority

May 24, 2018

One of the concurrent events held during the 13th Taiwan International Motorcycle Industry Show (Motorcycle Taiwan 2018), the seminar titled “Turning New U.S. Powersports Business Opportunities” was rounded off with overwhelming acclaim from the audience as a resounding success, mostly thanks to the excellent quality of the lecturers invited, all of whom are seasoned veterans and experts at high ...



Exhibition Highlights

Taiwan Firms Kicks off 2019 at ArabPlast </h2>

Taiwan Firms Kicks off 2019 at ArabPlast

Jan 10, 2019

The biannual ArabPlast 2019 is marked as the most indicative benchmark as the largest trade expo for plastics, petrochemicals and rubber industry in the MENA region. The show kicked off on Jan. 5, attracting 336 exhibitors from 27 countries. Taiwanese exhibitors also attended, led by Taiwan Association of Machinery Industry in a 34-member strong delegation, a size just shy of China and India. ...


2018 AAPEX Post-Show Report</h2>

2018 AAPEX Post-Show Report

Dec 24, 2018

The 2018 edition of Automotive Aftermarket Products Expo (AAPEX) kicked off from Oct. 30 to Nov. 1 at Sands Expo Center; a total of 6,269 exhibitors came from 43 countries/regions, a 4% growth compared to last year’s figures, using up over 5,000 booths. Organizers estimate that over 162,000 professional buyers from approximately 135 countries visited the largest show of its kind in the North Amer...


Source: show organizer

The 19th Fastener Trade Show Suzhou - China's leading one-stop purchasing platform for fasteners, machinery and supporting products

Dec 05, 2018

As a large international fastener specialized exhibition, the 19th Fastener Trade Show Suzhou will connect the upstream and downstream of fastener manufacturing industry. Focusing on end users and building a global fastener trade platform are the highlights of the show. The 17th Fastener Trade Show Suzhou, successfully held during 26-28 October 2017, was highly praised by exhibitors and visito...