April 20, 2024

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[THE INVESTOR] Tech giant Samsung Electronics will receive liquid-crystal display panels from its rival LG Display as early as the April-June period this year, according to sources on Jan. 31.

The talks for Samsung-LG collaboration started right after Tokyo-based display maker Sharp abruptly severed a partnership with Samsung for LCD supply in November 2015.

The unprecedented partnership between the two local competitors was previously anticipated to take place in the latter half this year due to tight supplies and technical issues needed to be solved beforehand.

The display unit of LG Group, however, is said to have made the decision to put forward the supply schedule for Samsung as it deemed the rare strategic partnership with the world’s largest TV maker could become an important long-term revenue source.

Samsung is also said to have wooed the display manufacturer, calling for swift supplies.
“Samsung requested LGD to supply LCDs in the second quarter as its TV business has been already suffering from the supply shortage of panels,” said an industry source on the condition of anonymity. 


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An LG Display spokesperson said, however, the details of the supply deal have not been decided yet, except that the supply will likely take place within this year.

“It will likely take some time for Samsung to test and redesign LG’s display modules to fit into Samsung TVs,” the spokesperson said.

The ceased LCD supply from Sharp dealt a serious blow to Samsung, which has been scaling down the production of LCDs for the past years as part of efforts to focus on mobile products equipped with organic light-emitting diodes,

The LG Group affiliate will first provide Samsung a relatively small batch of 600,000 43-inch displays and will increase the supply volume on a gradual basis down the road, according to sources.

Since the LCD supply halt, the Korean electronics giant has been seeking new partnerships with global LCD makers, including LGD and AUO of Taiwan.

Samsung has filed a US$492-million arbitration suit against Sharp, owned by Hon Hai Group of Taiwan, in a US court in December, claiming the display manufacturer broke a supply deal with short notice in November.

Sharp was supposed to supply 6 million LCD panels to Samsung from 2017, up from an annual supply of 5 million panels over the past couple years.

Other TV set makers, including Sony of Japan and Hisense of China, are mulling compensation suits for halted LCD supplies from Sharp.

By Kim Young-won (wone0102@heraldcorp.com)