Samsung Display is expanding its investment in OLED production lines for IT and transitioning to OLED for notebook computers. The move is a strategy to boost profitability while protecting market share amid Chinese companies' offensive on low-cost LCD panels. Spending on production equipment by display panel suppliers is expected to reach $7.7 billion this year, up 54 percent year on year, according to DSCC analysis on May 21.

Considering that equipment spending fell 59 percent last year compared to the previous year, capital spending this year is expected to be similar to 2022 when the global economy recovers. The company with the largest investment is Samsung Display, which focuses on high value-added OLEDs.

Samsung Display is expected to invest about $3.9 billion, or 30 percent, this year to build its 8.6-g eneration OLED factory for IT, according to DSCC. IT refers to mid-sized panels such as laptops, tablets and car displays, which are relatively small compared to TVS. The 8.6thgeneration OLED is the latest OLED panel with a glass substrate size of 2290x2620mm, which is about 2.25 times larger than the previous generation OLED panel, offering advantages in terms of production efficiency and image quality.

Tianma is expected to invest about $3.2 billion, or 25 percent, to build its 8.6-generation LCD plant, while TCL CSOT is expected to invest about $1.6 billion, or 12 percent, to build its 8.6-generation LCD plant. BOE is investing about $1.2 billion (9 percent) to build a sixth-generation LTPS LCD plant.

Thanks to Samsung Display's massive investment in OLED equipment, OLED equipment spending is expected to reach $3.7 billion this year. Considering that the total expenditure on LCD equipment is $3.8 billion, the two sides' investment in OLED and LCD mass production has surfaced. The remaining $200 million will be used for mass production of Micro-OLED and Micro-LED panels.

In November, BOE decided to invest 63 billion yuan to build a mass production plant for 8.6-generation OLED panels for IT, aiming to achieve mass production by the end of 2026, according to industry sources. IT panels account for 78 percent of the total investment in display equipment. Investment in mobile panels accounted for 16 percent.

Based on the massive investment, Samsung Display plans to lead the OLED panel market for laptops and in-car displays, which is expected to grow significantly from this year. To begin with, Samsung will supply mid-sized OLED panels to notebook manufacturers in the United States and Taiwan, creating market demand centered on high-end laptops. Next, it will facilitate the transition of in-car displays from LCD to OLED by supplying mid-sized OLED panels to car manufacturers.