According to TechNews, AUO held a board meeting and signed a contract with PlayNitride on October 31st. The deal entails PlayNitride assisting AUO in setting up a cutting-edge 6-inch Micro LED Chip on Carrier (CoC) production line at AUO’s Longtan Tech Park facility, offering an all-in-one solution. The contract is valued at a substantial 700 million NT dollars, with a duration of 30 months.

The CoC production line is a pivotal part of Micro LED manufacturing, and AUO emphasizes that this contract is distinct from the one they have with Ennostar.

AUO highlights that their partnership with PlayNitride in establishing the CoC production line not only puts them in control of the most vital raw materials for Micro LED but also enables them to bring CoC to Micro LED module production in-house. This strategic move is expected to significantly enhance production efficiency, increase yield rates, and bolster AUO’s competitiveness in terms of Micro LED product costs. This, in turn, accelerates the timeline for the mass commercialization of Micro LED.

AUO’s involvement in Micro LED research dates back to 2012, resulting in expertise in display technology and manufacturing processes. In the display industry, they’ve been integrating the supply chain and establishing a comprehensive Micro LED ecosystem, gradually working toward the goal of commercialization during the year of mass production for Micro LED. AUO has big plans for applying Micro LED display technology across various fields.

Addressing concerns about technology transfer, PlayNitride clarifies that technology transfer primarily pertains to well-established product technologies, carried out incrementally with different firms. At the same time, PlayNitride is committed to developing new processes and products, and with patent protection in place and specific company considerations, there’s currently no need to fret about any technology leakage.
In August this year, TrendForce predicted rapid growth in the Micro LED chip market, with an expected value of $27 million in 2023, marking a 92% YoY increase. This growth is expected to continue, reaching approximately $580 million in 2027, with a CAGR of about 136% from 2022 to 2027. AUO, known for LCDs, has already produced the world’s first 1.39-inch Micro LED watch panel. Major companies, including AUO’s current client Tag Heuer, are potential adopters of Micro LED wearable devices.
(Image: AUO)

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• Japanese Watchmakers and Western Automakers Boost Micro LED Market to Near US$600 Million by 2027, Says TrendForce

According to a report from TechNews, Micro LED technology boasts superior qualities such as higher transparency, richer color saturation, increased brightness, enhanced efficiency, and lower power consumption. It also extends product lifespans, making it an optimal choice for automotive displays. However, it currently grapples with challenges related to cost, mass transfer, extensive inspections, and red light efficiency, posing obstacles to large-scale production.

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According to a report by TechNews, TrendForce held the Micro LED Forum 2023 on the 5th, inviting numerous companies to share insights on the next-generation display market trends. Eric Chiou, Senior Research Vice President at TrendForce, believes that Micro LED technology is making significant strides in the metaverse sector this year. Many technological challenges need to be overcome, such as semiconductor integration techniques. Ever since AUO announced the mass production of Micro LED watches, cost reduction has become a major focus for many companies.

Chiou stated that to cut costs, chips are the most effective components to optimize. Manufacturers are shifting from using 6-inch wafers to 8-inch wafers for chip production to help reduce costs. In terms of mass transfer techniques, a few years ago, stamp transfer technology was in use, but the industry has been increasingly leaning towards laser transfer while striving for efficiency. In the future, there’s a strong possibility of moving towards a “hybrid transfer” approach, which combines stamp transfer and laser bonding methods.

For instance, companies purchasing equipment might conduct in-house experiments and modify equipment to suit their needs. Equipment providers are also drawing from industry experience to create new solutions, offering next-generation equipment to inexperienced customers, making the production process more practical.

Regarding product development, the most evident direction for Micro LED is in smartwatches. Chiou revealed that by 2026, the cost of a 2.12-inch Micro LED Apple Watch from Apple could potentially drop to $100, compared to the current $40-50 for OLED displays. This suggests that Micro LED may pose strong competition to OLED in the near future.

TrendForce anticipates that Apple Watch will attract more brands to invest in the development and promotion of Micro LED wearable devices, leading to a compound annual growth rate of 873% from 2022 to 2027. This year, the Micro LED chip production value is approximately $27 million, and with the market’s continuous expansion, it is expected to reach $600 million. The compound annual growth rate from 2022 to 2027 is projected to be 111%.

Dr. Mingchi Hsu, Special Assistant at the AUO Display Development Center, mentioned during the forum that the challenges of mass transfer in Micro LED technology were previously considered bottlenecks, but significant improvements have been made in the last two years. As for the inspection and repair aspects, AUO has developed its own equipment and has already completed its development.

Porotech’s primary technologies include Dynamic Pixel Tuning (DPT) and PoroGaN technology. Daniel He, Director of Product and Marketing Taiwan Branch Manager at Porotech, disclosed that they are currently mass-producing 8-inch GaN wafers and collaborating with Taiwanese foundries. Although they can produce 12-inch GaN chips, they plan to observe market response before proceeding.

Mr. Lin Mao-Song, General Manager of Coherent Technologies, a leading laser source technology company, stated that the inspection and repair phase in Micro LED manufacturing might be longer than the actual manufacturing process. A 99.95% yield rate implies a high repair proportion, making it crucial to enhance production yield and reduce costs. Laser technology plays a significant role in increasing production speed and yield, with excimer laser being the best choice for repair and mass transfer, achieving yields of over 99.99%.

According to research conducted by TrendForce, the much-anticipated Micro LED version of the Apple Watch is facing yet another delay and is now expected to be launched in the first quarter of 2026. The primary reason behind this delay is believed to be the need for reconfiguring the production supply chain.

Previously, industry speculations suggested that Apple would take charge of the core production process, particularly the massive transfer of Micro LED technology. However, recent industry research by TrendForce indicate that LG Display (LGD) might now take over this crucial aspect of the production process.

The critical process involved in the production of the Micro LED version of the Apple Watch, especially the massive transfer of Micro LED technology, has been a point of interest in the industry. It was widely speculated that Apple would handle this key engineering either at its Cupertino headquarters in the United States or potentially transfer the production to its facility in Longtan, Taiwan, for the essential massive transfer of the technology.

TrendForce understands that Apple’s decision to undertake the crucial engineering process in either the United States or Taiwan reflects their intent to have complete control over the core manufacturing process during the initial production phase. However, this approach also introduces complexities in terms of logistics and supply chain management, as the chips are set to be manufactured in Malaysia, the backplates in South Korea, and the final assembly by system integrators in China or Vietnam.

As a result, recent industry research by TrendForce indicate that Apple has finalized LGD as its primary collaborator for Micro LED production. This means that LGD will now be responsible for the critical massive transfer process. In addition to providing its own equipment and technical support, Apple is also expected to invest in LGD’s related equipment procurement to ensure a smooth transition and expedited progress in the Micro LED production pipeline.

For more information and details about the Micro LED industry, TrendForce will hold the “2023 LED Forum” on September 5th (Tuesday) from 9:30 am to 5:00 pm at the NTUH International Convention Center. The seminar has invited TrendForce’s Senior Research Vice President, Eric Chiou, as well as representatives from various industries such as Mojo Vision, ITRI, Lumus, Unikorn, Porotech, Nitride Semiconductor, Tohoku University, Coherent, InZiv, AUO, and Tianma to share the progress and related applications of Micro LED technology.

Throughout this year, the Micro LED industry has been receiving a constant stream of positive news in terms of new product launches, latest technological achievements, project progress, and investment and financing. This has once again accelerated the commercial development of Micro LED. TrendForce has collected and compiled various dynamics of Micro LED since the beginning of the year, providing a retrospective view of the latest progress in the Micro LED industry.

As of early June, a diverse array of Micro LED-related products have emerged this year, covering essential aspects of the Micro LED industry. These products include upstream components such as wafers, chips, devices, backplane materials, driver ICs, production equipment, micro displays, and micro display modules, as well as downstream end-user products like displays, automotive lighting, consumer-grade televisions, and AR glasses. In total, there are approximately 29 different products. These latest Micro LED products reflect the development trends within the Micro LED supply chain.

In the upstream segment, wafer manufacturers are focused on developing larger-sized Micro LED wafers, such as 8-inch and 12-inch wafers. Chip manufacturers are continuously improving the light emission efficiency of Micro LED. Equipment manufacturers are introducing devices that enable larger-scale production and testing of Micro LED.

In the midstream segment, an increasing number of manufacturers are paying attention to the applications of Micro LED micro displays. They have released multiple small-sized, high-resolution, and high-brightness monochrome or full-color micro displays and display modules to meet the application requirements of XR, smartwatches, and other head-mounted or wearable devices.

In the downstream and end-user segments, the abundant applications of Micro LED can be observed. These applications range from common large-sized display screen products to small-sized AR glasses, and even to automotive lighting and display applications, as well as flexible touch displays. Micro LED demonstrates its diverse range of applications as the ultimate display technology.

Furthermore, Micro LED applications extend beyond the aforementioned areas. Recent reports reveal that Apple plans to upgrade iPhone screen materials from OLED to Micro LED in the future, aiming to achieve higher brightness, lower power consumption, and superior contrast.

Eric Chiu, Vice President of TrendForce, predicts that looking ahead to 2026, with further maturation of Micro LED technology and costs, AR and automotive displays are expected to enter a fast track of development, driving the demand for Micro LED chips. Based on significant cost reductions, there is bold anticipation that by 2027, smartphones will also provide opportunities for Micro LED applications.

While the Micro LED industry boasts a rich variety of related products, Micro LED technology still faces several challenges. Therefore, continuous research efforts are underway, involving collaboration between academia and industry to gradually improve Micro LED performance. This year alone, approximately 17 Micro LED-related research projects have achieved notable results. These include advancements in red light efficiency, realization of full-color displays, improvement in massive transfer efficiency, and research on new structures and materials for Micro LED. The ultimate goal is to enhance Micro LED performance, production efficiency, and reduce application costs.

For more information on reports and market data from TrendForce’s Department of Display Research, please click here, or email Ms. Vivie Liu from the Sales Department at graceli@trendforce.com

(Photo credit: AUO)