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2015 OLED Emitting Materials Market, Dow Chem and LG Chem in Slump…Why?

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Hyunjoo Kang / Reporter /jjoo@olednet.com

 

Source: UBI Research, 2016 OLED Emitting Materials Annual Report

Source: UBI Research, 2016 OLED Emitting Materials Annual Report

 

In the midst of UDC`s domination of 2015 global materials market, with Japanese Idemitsu Kosan`s rapid growth and slump of emitting materials companied, there has been changes to the enviroment.

According to [2016 OLED Emitting Materials Annual Report] to be published by UBI Research in mid-April, the 2015 global emitting materials market recorded approximately a 17% growth compared to 2014

 

 

UDC’s revenue decreased from previous year, but remained at the top, the same as 2014. UDC was closely followed by Idemitsu Kosan despite its fourth place in 2014.

Such growth of Idemitsu Kosan is mainly due to its supply expansion in regards to Korean companies such as Samsung Display and LG Display. In 2015, Idemitsu Kosan began actively supplying Samsung Display with blue materials. Together with the increase in Idemitsu Kosan’s client LG Display’s OLED panel for TV mass production line’s operation rate, Idemitsu Kosan’s supply increased.

 

2015 Global OLED Emitting Materials Market Ranking Source: UBI Research, 2016 OLED Emitting Materials Annual Report

2015 Global OLED Emitting Materials Market Ranking
Source: UBI Research, 2016 OLED Emitting Materials Annual Report

 

◆ Samsung Display to Determine Up and Down of Companies

On the other hand, some OLED emitting materials companies that ranked high until 2014 showed poor performance. Dow Chem., that reached the second place in 2014 after UDC in revenue, fell to the fourth place in 2015 due to a big sales decrease. The third and fifth companies in 2014, LG Chem and Duksan Neolux respectively, fell below fifth place in 2015 due to the same reason.

Dow Chem. and Duksan Neolux are analyzed have recorded sales decrease in comparison to 2014 due to the supply chain changes of Samsung Display. In the case of LG Chem, the sales fell as the Samsung Display’s supply volume decreased.

However, Samsung SDI recorded sales increase, and entered within the top 5 in 2015. This company’s performance improved as it supplied Samsung Display with green host.

The company that recorded greatest growth is a Germany company Novaled that Samsung SDI, then Cheil Industries, took over. This company recorded approximately 150% revenue increase compared to previous year, and reached the third place in 2015 following UDC and Idemitsu Kosan. With the increase in OLED panel for TV mass production line’s operation rate, Novaled’s revenue greatly increased.

UBI Research estimated that in 2016, LG Display’s OLED TV mass production line operation rate and Galaxy Note series’ material structure, to be mass produced in the second half, will greatly affect revenue of OLED emitting materials companies.

[Light building 2016] Osram OLED Rear Lamp

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Osram is showcasing its OLED rear lamp for cars at Light+Building 2016.

Reviewing 2015 OLED Industry through Keywords

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  1. OLED TV

OLED TV, first released in Q4 2013, recorded approximately 50,000 units of shipment each in Q1 and 2 this year. The shipment increased to 100,000 units in Q3, more than twice the amount of each quarter in H1 2015. As it is estimated that close to 200,000 units were released in Q4, over 90% of LG Display’s 2015 target is expected to be achieved. This is considered to be showing price competitiveness against other TV as the price of OLED TV fell to 1/2 of the initial price and effectiveness of aggressive marketing emphasizing the advantages of OLED TV compared to newly released LCD TV. In Q3 earnings results announcement, LG Display revealed their plan of 1,000,000 units of OLED TV panel shipment in 2016 and forecast OLED TV’s growth. For the industry, 2015 has been the year that secured foothold for OLED TV’s market expansion.

 

  1. Galaxy S6 Edge

At the time of Galaxy S6 and Galaxy S6 Edge’s release, Samsung Electronics estimated the initial supply to be 50:50. However, Galaxy S6 Edge showed 70% in actual demand and this led to shortage in supply. Samsung Display met the demand by starting flexible AMOLED line operation earlier than scheduled. 2015 proved future market growth potential by opening consumers’ wallets through designs possible only with flexible AMOLED panel.

 

  1. Samsung Display Supply Diversification

During the Q3 earnings announcement, Samsung Display revealed their plan to expand non-Samsung clients by 30%. Accordingly, in Q3, when smartphone market’s growth was expected to slow down, the sales performance improved by 13% compared to its previous quarter through key client’s new product release and expansion of client base. Particularly, the market occupation of AMOLED panel shipped toward China is analyzed to have increased within the global mobile market as Chinese set companies released AMOLED panel equipped smartphones.

 

  1. Apple’s OLED Application

Apple, which has been using LCD panel for all products, first applied flexible AMOLED panel, produced by LG Display, to 2015 smartwatch Apple Watch and drew much attention. In H2, Apple diversified suppliers by using Samsung Display’s flexible AMOLED panel. This move is analyzed to be groundwork for flexible OLED application to smartphone following smartwatch. 2015 has been a year with much interest in when flexible AMOLED panel equipped iPhone will be released.

 

  1. OLED Lighting

Global OLED lighting industry went through a great transformation in 2015. OLEDWorks announced they will acquire key parts of Philips’ OLED lighting business, relevant production facilities, and intellectual property. With this take over, OLEDWorks greatly expanded business through widened product portfolio and simultaneous lighting panel mass production in the US and Germany. LG Chem. transferred OLED lighting business to LG Display. The value of transfer is 1.6 billion KRW, and it is seen to be a strategy to increase competiveness by transferring the business to LG Display with their OLED panel mass production knowledge and to focus on existing materials business. The take over and business transfer of the main players in OLED lighting industry, OLEDWorks and LG Chem., are following their own business strategy. However, following these moves, related investment is expected to be delayed for some time and eyes are on how these will affect the OLED lighting business overall.

 

LG Chem.’s OLED Lighting Business Toward LGD. What is the Future Direction?

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It was announced that LG Display will take over LG Chem.’s OLED lighting business department. As the department that was leading the opening of OLED lighting panel market is being merged into LG Display, a significant change in OLED lighting industry is anticipated.

 

One of the merits of this merge is expected to be further improving OLED lighting panel’s mass production potential through LG Display’s existing OLED panel mass production line, labor, and technology. Additionally, when new investment of OLED lighting panel mass production line is being processed, time and cost can be reduced on the basis of LG Display’s manufacturing equipment/material supply chains.

 

On the other hand, as OLED lighting market is still in initial stages the size is not so large. As such, whether LG Display will newly invest is a key issue. Generally, for display panel companies that invest with market size of thousands of millions of dollars in mind, OLED lighting panel line’s new investment does not seem to have a great advantage for LG Display.

 

Therefore, if LG Display carries out OLED lighting panel business, the first step is estimated to be mass production in parts of Paju’s AP2 line rather than new investment for OLED lighting panel mass production line. If parts of AP2 line begin mass production first, mass production timing can be much sooner than new investment and can positively affect expansion of OLED lighting panel market.

 

The issue is marketing strategy. In 2009, Samsung Electronics successfully opened AMOLED smartphone market in Korea via push strategy using AMOLED themed music video that became viral. Much like this, in order to show profit in OLED lighting panel business, LG Display should open the market through push marketing strategy.

[LED/OLED EXPO 2015] O’CLESS Propels OLED Lighting Commercialization

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At LED/OLED EXPO 2015 (23 – 26 June), HaeChan Design revealed that through OLED lighting specializing brand O’CLESS they are expanding into international market as well as within the domestic market in Korea.

 

HaeChan Design was established in July, 2013, and launched OLED lighting brand O’CLESS. O’CLESS is producing using the combination of LG Chem.’s OLED lighting panel, and their own designs and ideas.

 

In this exhibition, O’CLESS presented diverse lighting such as night light, portable light, stand light, mirror light, and rail connection down light. Particularly, smart system that can control down light using smartphone drew much attention from the visitors.

 

Seungchul Oh, the President of HaeChan Design, reported that they “began exporting to Japan and China following the domestic release in Korea”, and they are planning to “expand the market as a global OLED lighting specializing business once the new business establishment in Innovation City Chungbuk is completed”. Regarding the price issue, which is OLED lighting market’s biggest obstacle, Oh viewed future of OLED lighting market in a positive light: “P company’s night light is being sold for 200,000-300,000 KRW (200-300 USD) but even with application of OLED and Retinispora wood, O’CLESS’ product has competitive edge with approx. 100,000 KRW (100 USD). Although panel’s price is essential as design and practicality are more important in the lighting industry, application creation appropriate for the high cost of OLED is more important. OLED panel price has already fell considerably and will continue to do so and therefore can compete against LED or other lightings in terms of price.”

 

In February this year, HaeChan Design installed approximately 1,000 OLED desk lamps with LG Chem.’s OLED lighting panels in Seoul National University’s library. They also set up booths in 2014 LED/OLED Application & Technology Show and 2015 Kyunghyang Housing Fair, focusing on O’CLESS marketing.

 

O'CLESS Booth, LED/OLED EXPO 2015

O’CLESS Booth, LED/OLED EXPO 2015

http://www.facebook.com/lgoledlight.

LG Chem OLED light at Euroluce 2015

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LG Chem has participated in Euroluce 2015 in Milan, Italy. LG Chem showcased the latest products and solutions to the European lighting market. Many visitors left positive feedbacks and enjoyed the infinite application and design possibilities that OLEDs offer.

For more information, visit

http://www.lgoledlight.com

[Euroluce 2015] Enter OLED Lighting Cheaper Than LED

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An area has emerged where OLED lighting can exceed LED’s price competitiveness.

 

In LG Chem’s booth in Euroluce 2015 (April 14-19, 2015), a British company Mackwell’s OLED lighting applied emergency system was exhibited. Mackwell applied LG Chem’s OLED lighting panel to the emergency system used in cases of fire/blackout instead of existing LED lighting reducing the overall system installation cost. Mackwell is known to be preparing for commercialization.

 

LG Chem explained that “construction, excluding lighting, accounts for the 30-50% of total cost for interior lighting. LED lighting requires separate space for installation making construction cost a necessity, but as OLED lighting does not need additional construction this can be reduced. Although OLED lighting’s unit price is higher than LED’s, overall interior cost can be reduced if OLED lighting is used resulting in cheaper price”.

 

Regarding this, one LED expert observed that, “a certain distance is required between the LED lighting source and device, therefore LED installation space is additionally required and increases the cost” and “if the construction cost could be reduced from interior lighting it would be a great advantage”.

 

As shown, areas where merits of OLED lighting are actively used are emerging rapidly such as interior, medical, and vehicular lighting. If the cost competitiveness can be achieved from active investment by OLED lighting companies, not only the OLED lighting exclusive market could be created but existing lighting market could be replaced.

 

Mackwell’s Emergency Luminaire

Mackwell’s Emergency Luminaire

LG Chem. announces new OLED lighting product milestones

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LG Chem announced today that it achieved two important milestones in the development of OLED lighting products with the start of manufacturing of the 320 x 320 mm OLED light panel, the world’s largest available in the market, and the completion of the research and development phase for a new plastic-based OLED light panel.

The 320x320mm OLED light panel is 0.88mm thick panel and has an efficiency of 60lm/W, CRI over 90, and has output levels of 800lm with a nominal input (8.5V 1,600mA). The panel’s output can reach 1,200lm which is similar to a common 60-75 Watt incandescent lamp. This is significant because it marks first time that OLEDs can be considered as an energy-efficient / human-friendly light source available for general purpose use.

With LG Chem having begun mass producing the 320x320mm panels in January, the panels can be ordered at $680USD per panel, with a lower negotiated price for bulk orders.

150128_LG 화학, 새로운 OLED 조명 제품 목표 발표1

 

LG Chem has also completed development of a truly flexible plastic-based OLED light panel and engineering samples are now available. LG Chem’s current bendable OLED panels (F6BA40, F6BA30) are thin-glass based that provides a limited bending radius of 75mm. The new flexible OLED panel has vastly increased the bending radius flexibility to 30mm because of the adoption of a plastic substrate for the panel, which also eliminates the danger of the panel shattering when excessive force is applied.

The main challenge of converting from a glass substrate to plastic was to maintain the performance levels of efficiency, luminance, and CRI. LG Chem has overcome this challenge by adopting its expertise in barrier and encapsulation technology.

The specifications of the LG Chem’s new plastic-based OLED light panel are 60lm/W efficiency, 75lm brightness, 3,000K in color temperature, and CRI over 85. Engineering samples are available at $250USD per panel. The mass production of the flexible panel is scheduled to begin in July 2015. The price will be adjusted accordingly once mass production starts.

150128_LG 화학, 새로운 OLED 조명 제품 목표 발표2150128_LG 화학, 새로운 OLED 조명 제품 목표 발표3

LG Chem., provide OLED lighting panel illuminate Tincan, the restaurant in London

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LG Chem. continues its intense marketing activities for the OLED lighting. The OLED lighting panels were applied inside the Hanoak (traditional Korean house), remodeled with the IVAAIU City Planning last August, and the butterflied shaped lightings applying 240 OLED lighting panels were supplied to the caf? called Marley coffee in Itaewon. And the circular type OLED lighting panels were used to decorate Tincan, a newly opened pop-up restaurant in London in last September.

 

The OLED light used as the light source at Tincan was the Φ100 OLED Light panel (N6OA30) that the LG Chem. introduced early this year for the first time. The efficacy of the panel is 60lm/W, a high CRI is over 90, and the lifetime is 40,000 hours (LT70) at 3,000 cd/m2, with only 1mm in thickness. The Lamp was designed by the architectural design firm AL_A using 3D printing.

 

LG Chem. is leading the OLED lighting panel business most actively as making the announcement last September for the release of the OLED lighting panel in November which will be equivalent to a LED lighting with the efficacy of 100lm/W and the lifetime of 40,000, and it has secured various lighting companies like Acuity and Zumtobel as a client.

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< LG Chem.’s OLED lighting panel installed at Tincan>

reporter@olednet.co.kr