Samsung Plans To Spend $11 Billion Into Next-Generation Displays
Samsung has decided to pour KRW 13.1 trillion ($11 billion) for developing and building next-generation displays, responding to a flood of supply and price pressure from fast-moving Chinese rivals.
The plan has been formulated after an event attended by South Korean President Moon Jae-in and Vice Chairman of Samsung Electronics, Jay Lee. The investment planning was witnessed as an initiative to re-organize and renovate the display industry. This would maintain the global leadership of Samsung and mark the established dominance of Korea. This was the main objective behind investing KRW 400 billion for next-generation displays.
As per the company statement, Samsung is also planning to build a quantum-dot display production line in Asan and its operations will start from 2021 with an initial monthly capacity of 30,000 panels larger than 65 inches. It is expected that production will escalate from there with a long-term development plan that will stretch till 2025. This investment is expected to trigger 81, 000 jobs as confirmed by the company.
Samsung and its cross-town rival LG Display are in fierce competition from Chinese suppliers, like BOE Technology Group, which has aggravated the liquid crystal display-making capacity in recent years and is making inroads into next-generation screens. To diminish the reduction in margins and loss of clients, Samsung is developing the quantum-dot displays.
In a statement, Lee has remarked that Samsung is putting all its efforts to broaden the display industry which is one of the three main pillars- along with memory chips and smartphones in which the Korean tech champion has acquired a significant position. The decision was made at risk as the business environment has deteriorated along with a trade altercation between Korea and Japan. This brawl can create a discrepancy in the supply of chemicals and components which are necessary to manufacture advanced displays.
Besides displays, the unprecedented tensions between the US and China where Samsung earns a high proportion of revenue have resulted in the slump of chip industry at a time when smartphone demand tapers off and the pace of data centre construction decelerates.