Compared with the active investment of companies in Taiwan, China and Chinese Mainland in the MicroLED business, the investment of Korean panel manufacturers in this field may slow down because of the high production costs, insufficient application demand and insufficient profitability due to overheated competition.
According to industry reports in South Korea, Samsung Display (SDC) and LG Display (LGD) are adjusting their MicroLED business strategies. The former plans to continue investing in research and development, but will decide when to expand their business based on market conditions; LG has initially reduced its MicroLED workgroup staffing and is currently discussing various employee deployment plans.
Industry insiders point out that Samsung Display and LG Display are slowing down their MicroLED business plans mainly because the market potential has not met expectations. One example is that, according to reports, Apple cancelled its partnership with Ames Osram's MicroLED smartwatch in early 2024.
MicroLEDs have low yield and high cost due to the need for a large amount of technology to transfer LEDs onto substrates. This type of equipment is quite expensive, so it is difficult to achieve large-scale production without clear customers.
In addition, the current application of MicroLED is mainly limited to televisions. Due to increased investment difficulty, there are almost no products using MicroLED in mainstream IT devices such as displays, smartwatches, and smartphones. The annual sales of MicroLED TVs worldwide are only 1000-2000 units, far lower than LCD TVs (200 million units) and OLED TVs (8 million units).
In the above context, Sony of Japan, Youda Optoelectronics and Qunzhuang Optoelectronics in Taiwan, China, China, and Aledia of France are all trying to expand the application range of MicroLED products, which reflects that although the market size is small, the number of competitors is increasing. This also makes Samsung Display and LG Display adopt a cautious attitude in expanding investment. The display industry pointed out that these two large companies believe that MicroLED business is difficult to make a profit at present, so they will only consider expanding investment when product demand increases.
