Global demand growth for flat panel display expected to ease through 2021

After hitting 7.3 percent growth in 2018, global demand for flat panel displays (FPDs) in terms of area is forecast to expand 6.4 percent to 228 million square meters in 2019. It is the first slowdown in year-on-year growth in four years, according to IHS Markit(Nasdaq: INFO).

Although the FPD demand will continue to grow, mainly driven by migration to larger displays for major applications, such as TVs, desktop monitors, mobile PCs and smartphones, the pace is expected to slow through 2021.

“The uncertainty from rising global trade tension may pose a threat to panel demand,” said Ricky Park, director at IHS Markit.  “Huge investment in panel factories in China is also expected to continue to cause oversupply next year.”

According to the world economy and global markets report by IHS Markit, world real gross domestic product (GDP) growth is forecast to grow 3.0 percent in 2019, following 3.2 percent in 2018 and 3.3 percent in 2017. The 2019 world real GDP growth was revised down from a 3.4 percent forecast in April 2018 as trade disputes between the United States and China worsened. This will partially contribute to slower growth in end-market demand and the lower demand for FPDs next year.

Oversupply is also expected to have an impact as China Star initiates mass production of FPDs from its 10.5thgeneration fabrication plant (fab) – the world’s second largest – in Shenzhen, China, in the first quarter of 2019. HKC will also contribute to an increase in the production capacity by mass producing panels at its new 8.6thgeneration fab in the second quarter 2019. As a result, the production capacity of thin-film transistor panels is expected to increase by 11 percent in 2019 compared to 2018, and the supply will surpass demand at a greater magnitude than 2018.

“As the market forecast for both demand and supply does not look favorable, panel suppliers and set makers are trying to develop more advanced products and technologies, such as 8K resolution for TVs, quantum-dot organic light-emitting diode (QD OLED) TVs and foldable displays for smartphones and tablet PCs, to bolster consumer demand,” Park said.

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