The display industry includes all aspects of panels, related parts and materials, and equipment manufacturing. After cathode ray tube display devices in the 1960s and LCD display devices in the 1990s, the display devices are developing to a new generation of display technologies such as OLED, flexible, and transparent.
Pre-investment to ensure price competitiveness
The display industry is a pillar industry in South Korea and holds the top position in the LCD panel market.
Based on the world's strongest technological competitiveness, Korean companies lead the development of the world's display industry and maintain the world's top ranking in the LCD panel market. Affected by the international financial crisis, South Korea's exports in 2009 dropped sharply (by 13.9% year-on-year), but the volume of LCD TV panels increased by 20% year-on-year, expanding the world market share to more than 50%.
The display industry is a pillar industry of the Korean economy. In 2009, South Korea showed that industry added value accounted for 3.4% of its GDP, which was approximately 38.9 trillion won; exports accounted for 8.6% of its total exports, reaching 31.4 billion US dollars. The employment scale of about 90,000 people makes an important contribution to job creation. South Korea's display industry has absorbed 4.5% of undergraduate professionals in employment.
South Korea’s global market share of LCD panels for TVs was 45.8% in 2008 and 52.5% in 2009. However, the competitiveness of display device production equipment and materials is still weak, and the production equipment and spare parts materials used for display devices rely on overseas situations have not yet been improved.
At present, mainland China is making every effort to nurture the LCD industry. For example, Samsung, LG, Sharp and other South Korean companies, Japan, and China Taiwan are increasing investment in LCD panels in mainland China. In addition, cooperation between mainland China and Taiwan, such as the signing of the Cross-Strait Economic Cooperation Framework Agreement (ECFA), will accelerate competition among LCD panel companies.
Pre-investment to ensure price competitiveness is an important factor for South Korea to capture the world's display market. Samsung, LG, etc. boldly invested in the LCD4 generation line during the 1997-1998 Asian financial crisis, which laid the foundation for the current world LCD market. South Korea invested in the LCD8 line at the time of the 2008 international financial crisis, laying the foundation for the sound development of 2009.
Breakthrough equipment bottleneck
Weak equipment industry is one of the problems that needs improvement in a short time.
In terms of competitors, the LCD industry in Mainland China has grown rapidly. There is a technical gap of about 3 years between mainland China and South Korea. However, mainland China has set itself the goal of becoming the world's largest market for LCD domestic demand. It has also announced plans for industrial revitalization and is strengthening its high-generation LCD panel production capabilities. By 2012, it will have the same 8th generation LCD panel production capacity as Korea. By around 2014, it is expected to achieve 20% market share in the LCD world market.
At the same time, Taiwan in China began to push China’s Taiwan to become the second largest display device production base in the world. Although its competitiveness is relatively low, Taiwan is currently catching up with South Korea through measures such as cross-strait cooperation and mergers and acquisitions among companies.
In terms of production equipment and spare parts materials, the Korean domestic equipment industry has a weak technological competitiveness and a small scale. As global LCD panel companies continue to accelerate their entry into China and their investment quotas continue to expand, South Korean companies’ investment in next-generation display areas continues to grow, and demand for equipment is rapidly increasing. At present, the localization rate of South Korea's inspection and cleaning equipment and other post-process equipment is more than 80%, and it also has export competitiveness, but the localization rate of core front-end equipment (high value-added equipment) such as exposure machines is only 20%. The market is controlled by Japan. South Korea's sales of the first equipment company (SFA) is only 1/5 of the world's No. 1 (NIKON). The localization rate of equipment is relatively low (50% level in 2008). Demand companies are more inclined to foreign equipment. Weakness in the strength of the equipment industry market is also one of the problems that the Korean display industry needs to improve in a short period of time.
The core spare parts and materials mainly depend on imports. Based on the country’s support for LCD R&D work, the localization rate of parts used in some LCD panels has risen to 70%, but the dependence on overseas imports of core materials remains high. The localization rate of flat plates is 72%, but the core materials of flat plates, TAC and PVA films, are all dependent on imports. U.S. and Japanese companies are based on existing technology patents in the field of spare parts and materials and are strengthening market control. It takes a long time to catch up with these countries. In the future, South Korea will vigorously develop display equipment and spare parts materials, and strive to become the main supplier of production equipment and spare parts materials for the Chinese LCD market.
At the same time, companies are also faced with difficulties such as high tariffs and environmental constraints. The basic tariff rates for Korean display device production equipment are higher than that of Japan, China, and other rival countries. Therefore, such unfavorable factors should be eliminated in price competitiveness. As the world is increasing its emphasis and support on environmental protection, it is necessary to speed up the environmental protection process of display devices such as process technology and equipment development.
In addition, in the aspect of talents, university training centered on theoretical knowledge is difficult to cultivate the talents needed by the company, especially the professional R&D personnel is seriously insufficient. Moreover, even though South Korea has the largest LCD panel in the world, its international standards are owned by Japan. In particular, South Korea's small and medium-sized equipment companies have relatively weak patentability.
Increase Next-Generation LCD R&D
By 2012, South Korea will actively support investment in 11th generation LCD panel production lines.
South Korea has listed the OLED industry as a mid- to long-term development goal. The goal is to enable South Korea to become the world's first mass production country for AMOLED TVs and OLED lighting panels, and to ensure the competitiveness of core technologies in next-generation display areas such as flexible displays and printed electronics.
In 2012, when China's eighth-generation LCD panel production line was officially launched, South Korea actively supported the investment in its 11th-generation LCD panel production line. Strengthen the support of private companies in the 11th generation LCD investment roadmap for equipment and spare parts development. The equipment is mainly centered on core equipment with high dependence on overseas imports and high development costs, and has increased R&D funding support. The spare parts and materials will focus on the development of parts and components that have a high share of LCD panel production costs, overseas import dependency of more than 70%, and optical components.
Help companies solve difficulties. First, the tariff system, which is more unfavorable to the reform than the competitor countries, has increased support for investment in equipment investment. After consultation with related departments, reduce the tariff rate in the display area. At the same time, we will increase the localization rate of upstream industries to reduce the dependence of equipment and materials on overseas. We will increase the localization rate of display devices and materials that are currently only 50% to 70%. For varieties that need to be imported for equipment investment due to unrealized localization, and factory automation machinery, etc., it is necessary to fully consider the support policies for the continuous provision of tariff adjustments and tariff reductions for factory automation equipment. Four kinds of equipment such as a vacuum coating machine, a dry etching machine, a vacuum coating machine for OLEDs, and a molding machine for glass production are applying the adjustment tariff.
The second is to increase the display industry's support in the areas of technology, equipment development, and foundations that are needed to actively respond to environmental protection. Develop environmentally friendly process technologies, such as the development of fluorinated gas replacement technologies such as SF6 for LCD manufacturing processes and new processes for limiting greenhouse gases. To ensure the precision and mass production of printed electronics technology, develop "Zero Greenhouse Gas Process Technology". The Eco-Display Research Center was established to establish a green manufacturing center for supporting small and medium-sized equipment companies.
Pre-investment to ensure price competitiveness
The display industry is a pillar industry in South Korea and holds the top position in the LCD panel market.
Based on the world's strongest technological competitiveness, Korean companies lead the development of the world's display industry and maintain the world's top ranking in the LCD panel market. Affected by the international financial crisis, South Korea's exports in 2009 dropped sharply (by 13.9% year-on-year), but the volume of LCD TV panels increased by 20% year-on-year, expanding the world market share to more than 50%.
The display industry is a pillar industry of the Korean economy. In 2009, South Korea showed that industry added value accounted for 3.4% of its GDP, which was approximately 38.9 trillion won; exports accounted for 8.6% of its total exports, reaching 31.4 billion US dollars. The employment scale of about 90,000 people makes an important contribution to job creation. South Korea's display industry has absorbed 4.5% of undergraduate professionals in employment.
South Korea’s global market share of LCD panels for TVs was 45.8% in 2008 and 52.5% in 2009. However, the competitiveness of display device production equipment and materials is still weak, and the production equipment and spare parts materials used for display devices rely on overseas situations have not yet been improved.
At present, mainland China is making every effort to nurture the LCD industry. For example, Samsung, LG, Sharp and other South Korean companies, Japan, and China Taiwan are increasing investment in LCD panels in mainland China. In addition, cooperation between mainland China and Taiwan, such as the signing of the Cross-Strait Economic Cooperation Framework Agreement (ECFA), will accelerate competition among LCD panel companies.
Pre-investment to ensure price competitiveness is an important factor for South Korea to capture the world's display market. Samsung, LG, etc. boldly invested in the LCD4 generation line during the 1997-1998 Asian financial crisis, which laid the foundation for the current world LCD market. South Korea invested in the LCD8 line at the time of the 2008 international financial crisis, laying the foundation for the sound development of 2009.
Breakthrough equipment bottleneck
Weak equipment industry is one of the problems that needs improvement in a short time.
In terms of competitors, the LCD industry in Mainland China has grown rapidly. There is a technical gap of about 3 years between mainland China and South Korea. However, mainland China has set itself the goal of becoming the world's largest market for LCD domestic demand. It has also announced plans for industrial revitalization and is strengthening its high-generation LCD panel production capabilities. By 2012, it will have the same 8th generation LCD panel production capacity as Korea. By around 2014, it is expected to achieve 20% market share in the LCD world market.
At the same time, Taiwan in China began to push China’s Taiwan to become the second largest display device production base in the world. Although its competitiveness is relatively low, Taiwan is currently catching up with South Korea through measures such as cross-strait cooperation and mergers and acquisitions among companies.
In terms of production equipment and spare parts materials, the Korean domestic equipment industry has a weak technological competitiveness and a small scale. As global LCD panel companies continue to accelerate their entry into China and their investment quotas continue to expand, South Korean companies’ investment in next-generation display areas continues to grow, and demand for equipment is rapidly increasing. At present, the localization rate of South Korea's inspection and cleaning equipment and other post-process equipment is more than 80%, and it also has export competitiveness, but the localization rate of core front-end equipment (high value-added equipment) such as exposure machines is only 20%. The market is controlled by Japan. South Korea's sales of the first equipment company (SFA) is only 1/5 of the world's No. 1 (NIKON). The localization rate of equipment is relatively low (50% level in 2008). Demand companies are more inclined to foreign equipment. Weakness in the strength of the equipment industry market is also one of the problems that the Korean display industry needs to improve in a short period of time.
The core spare parts and materials mainly depend on imports. Based on the country’s support for LCD R&D work, the localization rate of parts used in some LCD panels has risen to 70%, but the dependence on overseas imports of core materials remains high. The localization rate of flat plates is 72%, but the core materials of flat plates, TAC and PVA films, are all dependent on imports. U.S. and Japanese companies are based on existing technology patents in the field of spare parts and materials and are strengthening market control. It takes a long time to catch up with these countries. In the future, South Korea will vigorously develop display equipment and spare parts materials, and strive to become the main supplier of production equipment and spare parts materials for the Chinese LCD market.
At the same time, companies are also faced with difficulties such as high tariffs and environmental constraints. The basic tariff rates for Korean display device production equipment are higher than that of Japan, China, and other rival countries. Therefore, such unfavorable factors should be eliminated in price competitiveness. As the world is increasing its emphasis and support on environmental protection, it is necessary to speed up the environmental protection process of display devices such as process technology and equipment development.
In addition, in the aspect of talents, university training centered on theoretical knowledge is difficult to cultivate the talents needed by the company, especially the professional R&D personnel is seriously insufficient. Moreover, even though South Korea has the largest LCD panel in the world, its international standards are owned by Japan. In particular, South Korea's small and medium-sized equipment companies have relatively weak patentability.
Increase Next-Generation LCD R&D
By 2012, South Korea will actively support investment in 11th generation LCD panel production lines.
South Korea has listed the OLED industry as a mid- to long-term development goal. The goal is to enable South Korea to become the world's first mass production country for AMOLED TVs and OLED lighting panels, and to ensure the competitiveness of core technologies in next-generation display areas such as flexible displays and printed electronics.
In 2012, when China's eighth-generation LCD panel production line was officially launched, South Korea actively supported the investment in its 11th-generation LCD panel production line. Strengthen the support of private companies in the 11th generation LCD investment roadmap for equipment and spare parts development. The equipment is mainly centered on core equipment with high dependence on overseas imports and high development costs, and has increased R&D funding support. The spare parts and materials will focus on the development of parts and components that have a high share of LCD panel production costs, overseas import dependency of more than 70%, and optical components.
Help companies solve difficulties. First, the tariff system, which is more unfavorable to the reform than the competitor countries, has increased support for investment in equipment investment. After consultation with related departments, reduce the tariff rate in the display area. At the same time, we will increase the localization rate of upstream industries to reduce the dependence of equipment and materials on overseas. We will increase the localization rate of display devices and materials that are currently only 50% to 70%. For varieties that need to be imported for equipment investment due to unrealized localization, and factory automation machinery, etc., it is necessary to fully consider the support policies for the continuous provision of tariff adjustments and tariff reductions for factory automation equipment. Four kinds of equipment such as a vacuum coating machine, a dry etching machine, a vacuum coating machine for OLEDs, and a molding machine for glass production are applying the adjustment tariff.
The second is to increase the display industry's support in the areas of technology, equipment development, and foundations that are needed to actively respond to environmental protection. Develop environmentally friendly process technologies, such as the development of fluorinated gas replacement technologies such as SF6 for LCD manufacturing processes and new processes for limiting greenhouse gases. To ensure the precision and mass production of printed electronics technology, develop "Zero Greenhouse Gas Process Technology". The Eco-Display Research Center was established to establish a green manufacturing center for supporting small and medium-sized equipment companies.
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