|A demonstration of Samsung's latest QLED TV at Samsung Digital Plaza in Yongin, Gyeonggi Province Korea Times file|
By Kim Yoo-chul
Samsung Display has decided to continue producing LCDs after a request from Samsung Electronics, the world's top TV maker, sources said Tuesday.
"Upon requests by Samsung Electronics to do so, Samsung Display decided to extend the period of LCD production," an official said. "The latest decision is the second time Samsung Display has extended the period, both in Korea and China, and now to March next year."
But Samsung Display said the final decision will come after reviewing market conditions and depend on factors that affect the best interests of the company.
"Because of this, the duration and extent of the production extension have yet to be decided," it said.
Months ago, Samsung Display said it planned to end LCD production by the end of this year amid declining demand for the panels and a supply glut. It said it would only supply ordered LCDs to existing customers.
But the strategy shift is in accordance with rising LCD prices amid the continued spread of COVID-19, which has seen booming demand for electronics because the world is dealing with "stay-at-home" orders and lockdowns.
The pandemic also is disrupting global component supply chains, with LCDs in short supply.
But from Samsung Display's standpoint, the extension of LCD output isn't good as the company has no option but to restructure its losing LCD business while the market is overtaken by cheap LCDs from Chinese companies.
Samsung Display said the money saved halting LCD production will be used to strengthen its quantum dot (QD)-OLED output. These displays are in essence a mix between traditional LCDs and OLEDs, in which Samsung Display has a competitive edge.
Samsung said it was planning to invest more than 10 trillion won in QD-OLED production and the first product will be a high-end TV.
"Amid the rise of LCD prices, Chinese LCD makers such as BOE have shifted their stance, charging more to buyers," another official said. "Samsung Electronics' request is because of its intention to procure LCDs stably and manufacture LCD-oriented TVs with an affordable price."