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LCD TV panel production: most important fab is 8G

As panel makers expand, they are increasingly utilizing 8G fabs for LCD TV panel production, and the production of LCD TV panels at 8G increased to 41% in the 3Q of 2010, up from 35% in the 2Q, and is…

As panel makers expand, they are increasingly utilizing 8G fabs for LCD TV panel production, and the production of LCD TV panels at 8G increased to 41% in the 3Q of 2010, up from 35% in the 2Q, and is expected to grow 42% in the 4Q based on panel makers“ plans, according to DisplaySearch. Meanwhile, 6% of notebook panels were made on 6G lines in the 3Q of 2010, and will increase to 9% in the 4Q. “The evolution of fab generations in the TFT-LCD industry is not only a shift to larger glass substrates but also involves moves to increase production efficiency. For example, 32-inch widescreen LCD TV panels were originally designed to be made in 6G fabs, but more than 70% of the panels are currently produced in 8G fabs and 6G fabs have gradually shifted to LCD monitor panel production”, noted Shawn Lee, senior analyst for TFT-LCD production strategy at DisplaySearch. Mr. Lee continued, “The recent adoption of 0.5mm glass substrates in 6G and larger fabs also enhances production flexibility, as panel makers can make notebook and monitor panels in 6G and larger fabs using the same glass thickness as in smaller fabs. The 16:9 aspect ratio prevailing in PC displays also enables 5G and 6G fabs to produce notebook and monitor panels, respectively. For example, panel makers like AU Optronics (AUO), Chunghwa Picture Tubes (CPT) and LG Display are starting to produce notebook PC panels in 6G fabs, while AUO, LG Display and Samsung Electronics are producing LCD monitor panels in 7G fabs, and Samsung and LG Display are producing LCD monitor panels in 8G fabs. This flexibility benefits panel makers as they can more effectively leverage their existing capacities. At the same time, this trend will create trade-offs between production of IT and TV panels”. 5G fabs dominate production of netbook/tablet PC panels, including 10.1-inch netbook and 9.7-inch iPad panels, and 89% of notebook panels are made in 5G fabs, from 11.6-inch widescreen to 18.4-inch widescreen. 5G to 7G are currently the main fabs producing monitor panels, while 50% of TV panels are made in 6G or 7G fabs. Another way to look at production strategy is by glass substrate input for each application. In terms of area, panel makers allocated 5% of 5G, 25% of 5.5G, 65% of 6G, 78% of 7G, 97% of 8G and 100% of 10G for TV panel production. TFT-LCD production inputs were 34.1 million square meters in the 3Q of 2010, a 10% decline from the 2Q, due to reduced capacity utilization. In the 4Q of 2010, panel makers are targeting 38.5 million square meters input, as they gradually increase utilization. In terms of shipment units, Korea dominated panel production with 52% share in the 3Q of 2010, up from 47% in in the 3Q, while Taiwan accounted for 38% in the 3Q, down from 42% in the 2Q. Japan had 6% and China 4% in the 3Q. The shares are expected to hold in the 4Q of 2010. In the 3Q of 2010, LG Display dominated input area with 27%, followed by Samsung at 24%, Chimei Innolux (CMI) at 16%, AUO at 14%, and Sharp at 8%. Based on panel makers“ current production plans, the shares will be similar in the 4Q. For LCD monitor panel production, area inputs in the 4Q of 2010 will be dominated by LG Display with 27%, CMI with 26%, Samsung with 18%, and AUO with 15%. LG Display is producing 9.7-inch tablet PC panels on 3.5G and 5G, while CMI and Samsung are using 5G. LG Display plans to produce 9.7-inch panels on a 6G line starting in 2011. In the 3Q of 2010, accounting for capacity utilization, 8G led in glass substrate input area, accounting for 27% of global capacity, followed by 7G with 23%, 6G with 20%, and 5G with 19%. 5.5G accounted for merely 2% of input area and 10G for 4%.

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