In May, TV panel prices are expected to continue rising due to strong inventory momentum and dynamic operating capacity utilization by panel manufacturers. Especially Chinese manufacturers aim to restore TV product profits to above break-even points by the end of Q2, so the price increase of TV panels in May is significant. Full-size TV panel prices are expected to increase by 1~10 USD, which are all predicted to rise above cash costs in May.

VA panels are in higher demand than IPS panels for monitors currently, and Open Cell panel prices have slightly risen in recent months. The monitor panels are expected to continue to rise by 0.3~0.5 USD in May. Module product demand outlook is uncertain, with limited price increase space, so prices will likely remain stable in May. Taiwanese panel manufacturers have released information on price increases for monitor panels, and their impact on the market atmosphere and price trends needs to be observed still.

Demand momentum for notebook panels is slowly increasing, but the overall demand outlook is unclear, so the NB brands remain conservative attitude on their panel inventory. Meanwhile, the NB brands are expected to be high-maintenance while dealing with the tentative messages about raising the NB panel prices from panel manufacturers. Therefore, TrendForce believes that notebook panel prices are expected to remain stable in May.

Under the panel manufacturers’ ongoing strategy to control their operation rates and the growing demand for TV panels in the Chinese domestic market, TV panel prices are expected to continue to rise in April. However, there is a noticeable trend of first and second-tier brand customers disengaging, with second-tier brand customers having weaker bargaining power and mostly accepting the price increases.

While first-tier brand customers still have some room for negotiation, the overall trend of TV panel prices for all sizes remains unchanged. The price increases for the entire month of April are expected to be 1 USD for 32 inches, 3 USD for 43 inches, 6 USD for 50 inches, 7 USD for 55 inches, 13 USD for 65 inches, and 10 USD for 75 inches.

Since March, monitor panel prices have stabilized after a gradual decline. While demand for commercial models remains weak, there are signs of increased demand for consumer models, particularly for high-end gaming specifications, which is expected to keep monitor panel prices stable for all sizes this month.

As for notebook panels, first-tier brand customers’ cautious outlook on demand for the next quarter due to slow inventory clearance continues to suppress panel manufacturers’ ideas of raising prices. Therefore, it is expected that the prices will remain stable for the entire month of April. The key to whether prices can be raised in the future still depends on whether demand begins to significantly increase.

TrendForce’s research shows that material shortages, logistical delays, and relief subsidies for the American people not only supported global TV panel shipments in 1H21, but also drove an extended rise in quotations. However, as end product inventory climbed, stocking momentum fell rapidly in 2H21, not only inducing a sluggish peak season, but also bringing about a 1H22:2H22 shipment ratio that deviated from historical precedent. Shipment volume was not the only performance statistic to fluctuate in 2021. Originally planned factory closures were also delayed due to market demand, again transforming the entire industry landscape.

Looking forward to 2022, the global display production capacity of large generational fabs in 2022 will continue to grow through OLED production capacity generated by Korean panel manufacturers, the extension of LCD production, and continuing injection of maximum production capacity into the market from certain LCD production lines originating from panel manufacturers in other regions. Thus, overall TV panel supply is expected to spike dramatically. Although demand in emerging markets has recovered, TV panel quotations are also more prone to manipulation by branded panel companies than in 2021. A certain amount of momentum is expected in the end market for the stocking of TV panels. However, considering continually rising shipping and logistics costs, the unresolved global inflation issue, and life gradually returning to normal will inhibit the shipment performance of TV sets, demand for panels will also see an impact.

Therefore, after considering a number of factors, TrendForce expects global TV panel shipments to reach 281 million units in 2022, with an annual growth rate of 4.3%. As panel makers continue to implement a strategy of increasing panel size and overall shipments increase, positive growth is expected in size of shipped area.

The current global Gen5 and above large generational fab LCD panel supply and demand model shows that the growth rate of demand area cannot keep up with the growth rate of supply area and the shortfall between supply and demand in 2022 will be larger than that in 2021, which also suggests that panel manufacturers will meet tougher challenges in 2022. It is worth mentioning that there are still several key factors to be observed in 2022. For example, the closing schedule of LCD production lines at Korean panel factories, the adjustment of TV and IT panel capacity allocation, and the impact of the pandemic and war on whole device demand and component supply will all be key indicators of display industry trends leading into 2022.

（Image credit: Samsung）

Micro LED large-sized displays will move towards the home theater and high-end commercial display markets and the revenue of Micro LED large-sized display chips is estimated to reach US$54 million in 2022, according to TrendForce’s latest research. By 2026, revenue is expected to grow to US$4.5 billion with a compound annual growth rate of 204%. In addition, technical obstacles will be conquered one by one over time. The development of Micro LED large-sized displays will peak from 2026 to 2030 and the one year revenue of Micro LED chips has the opportunity to reach tens of billions of dollars.

In recent years, major global brands in various regions have released Micro/Mini LED self-emissive large-sized display products. Samsung, the world’s leading TV manufacturer, released a 146-inch TV, “The Wall,” in 2018 and continues to release 75-inch, 89-inch, 101-inch, 110-inch, 219-inch, and 292-inch large tiled wall displays at CES every year. Due to the evolution of different application scenarios and technologies, the future development trend of Micro LED large-sized displays will be in home theaters, corporate headquarters, and boutique stores. Commercial indoor and outdoor large-sized displays are mainly based on Mini LED self-emissive large-sized displays. In order to satisfy the requirements of close indoor viewing, Micro LED large-sized displays require a theater-level experience, seamless tiled display splicing, pursuit of zero borders, thin design, and competitive pricing. Thus, active matrix (AM) would be the first choice for display design.

TrendForce states, current Micro LED large-sized displays still face the dual challenges of technology and cost including Micro LED chip cost, and the three key technologies of backplane technology, driving technology, and the mass transfer process. In terms of Micro LED chip cost, due to the enormous number of chips used and the need for consistent wavelength uniformity to achieve perfect display quality, the clean room level requirements for epitaxial and chip processes, control of process conditions, and inspection and maintenance during processes are very strict, greatly increasing relative process defect rate and overall cost. In terms of mass transfer, the current mass transfer technologies used in Micro LED large-sized displays include pick-and-place technology and laser transfer technology, each with its own advantages and disadvantages. TrendForce believes that, although current Micro LED mass transfer technology is still in the product development and adjustment stage, there have been no real quantitative achievements. However, in terms of pick-and-place mass transfer equipment capacity, using 10cm2 transfer stamps to transfer 34*58µm Micro LED chips, production capacity (UPH; Unit per Hour) is approximately 7 million units. If the laser mask opening of laser mass transfer technology is 8 square millimeters, production capacity is approximately 12 million units. No matter which kind of transfer technology, the mass transfer capacity of Micro LED large-sized displays needs to reach at least a 20 million unit level of efficiency and 99.999% yield in the future to meet the conditions for mass commercialization.

Active matrix design will abet the development of Micro LED technology

In terms of backplane and drive technology, passive matrix (PM) drive design is based on a PCB backplane with a passive drive circuit structure, using MOSFET as the current switching element. Therefore, overall structure is more complex and requires a wider placement area for circuit components. In addition, when dot pitch is reduced to less than P0.625, the PCB backplane will encounter the challenges of line width and line space mass production limitations and rising cost. Thus, the current technological state of the passive matrix (PM) drive design is more suited to large-sized display applications utilizing dot pitches greater than P0.625 and equipped with a Mini LED. However, for consumer Micro LED TVs employing a dot pitch less than P0.625, active matrix (AM) drive design will become the new direction of display design. Since a TFT glass backplane with LTPS switching technology is considered mature technology by panel manufacturers, it is necessary to adjust certain portions of the manufacturing process and parameters to precisely control and drive Micro LED current.

In addition, in order to achieve seamless tiled display splicing technology, glass metallization and side wire electrode glass will become further technical challenges. As resolution moves higher and the dot pitch is reduced, the front circuit of TFT glass must be guided to the back along the side or by using through-holes. At this time, glass metallization technology becomes key. Since current glass metallization technology is still afflicted with technical bottlenecks resulting in high cost due to low yield, when these bottlenecks are resolved with future technology, the launch of mass production glass metallization will become the advantage of active matrix backplanes. Future active matrix (AM) drive design with Micro LED chips and seamless splicing technology have the opportunity to become the mainstream technology of Micro LED TV development and the key to unlocking a new wave of Micro LED large-sized display cost optimization.

Thanks to their continued capacity expansion and M&A efforts, Chinese panel manufacturers accounted for nearly 60% of the global supply of TV panels in 1H21, according to TrendForce’s latest investigations. These suppliers have not only managed to dominate their global competitors, but also become the key determinant of the supply and demand situation in the TV panel market. TrendForce believes that, while the TV panel market has started to experience a bearish trend, the industry must pay close attention to whether Chinese suppliers will eschew their previous strategy of maximum capacity utilization and instead turn to other options in order to maintain the health of the overall market. Taiwanese and Korean suppliers, on the other hand, have opted for a strategy that optimizes their existing operations by reallocating some of their production capacities from TV panels to other product categories such as IT panels. In addition to raising these suppliers’ competitiveness through better product differentiation, the reallocation of production capacity also alleviates the suppliers’ pressure of having to rely solely on TV products to expend their panel capacities.

Because the TV panel market’s out-of-balance supply and demand situation is unlikely to be resolved on its own, certain panel manufacturers have already begun assessing the feasibility of adjusting their production capacities for 4Q21. In particular, Gen 8.5 and Gen 10.5 production lines, which manufacture the majority of TV panels, play a key role in ensuring balance between the market’s supply and demand. While panel suppliers are expected to independently reduce their current capacity utilization rates, their new production lines will also gravitate towards a slowdown in panel output. Furthermore, ongoing issues with the supply of glass substrates will also constrain the capacity utilization rates of certain panel suppliers.

Taking the above considerations into account, TrendForce expects Gen 5 (and above) production lines to contribute to the supply of all display panels, measured by total panel area, by 2.5% less than previously expected for 4Q21. As well, in order to alleviate the pressure of excess production capacity for TV panels, panel suppliers will not only increase the share of 85-inch (and above) TV panels in their current output, but also reallocate some of their production capacities from TV panels to IT panels, including desktop monitor panels and notebook panels, both of which are currently in demand. These aforementioned assumptions would suggest that total TV panel input by area is expected to undergo a 2.1% QoQ decline for 4Q21. In particular, Gen 8.5 lines, which account for much of TV panel manufacturing, will experience the most noticeable capacity reduction at an 11.5% QoQ drop for 4Q21.

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 vivieliu@trendforce.com