LGD is still constructing its $650-million Gen-8 M2 OLED TV production line, but the company's CEO announced yesterday that LGD will invest a further 700 billion Won (over $788 million) to increase the capacity of that fab to 34,000 monthly substrates (up from 26,000).
It seems that LG is forecasting a rising demand for OLED TVs once their prices become competitive with LCDs (which should happen once the M2 is online). The company also wants to sign up more TV producers besides LG Electronics (they are currently supplying to China's Skyworth and Changhong, but reportedly they are in talks with Sony and Panasonic as well).
LGD's CEO further commented that they expect their OLED business to produce "significant" results to the company by the end of 2015, and they see OLEDs become the mainstream TV technology quickly - faster than it took CRT and LCD TVs to do so.
This is terrific news from LG. Once again we witness how the Korean company is taking the lead with OLED TVs, while its rivals (including Samsung Display) aren't yet committed. LG's WRGB technology is proving to be easier to produce compared to SDC's direct-emission panels.
Earlier this month a company official said that LG wants to ship over 5 million OLED TVs in 2015. Even if the M2 is at 100% yield, it will only be able to produce 1.8 million panels with 26,000 substrates and 2.3 million with 34,000 substrates. So even with this large new investment, they will not be able to reach their target (unless they plan on building more high capacity fabs soon).
I'm also a bit confused with the investment amount. If 26,000 monthly Gen-8 substrates required a $650 million investment, it's not clear why they now want to spend $788 million while adding only 8,000 new monthly substrates. Perhaps they are considering adding a new line with 34,000 more substrates, bringing the total to 60,000 monthly substrates? this will bring LGD's capacity to over 4 million 55" panels in 2015 (at 100% yield).
One thing is clear - LG is quickly moving towards OLED TV mass production!
In addition to their OLED TV production, LG Display is currently making flexible OLED in a small-scale 4.5-Gen production line that has a monthly capacity of 6,000 substrates. The company already stated back in January that they may expand this capacity towards the end of 2014, and yesterday LGD's CEO reported that the company still hasn't decided whether to make the additional investment required to boost the capacity.
Apple reportedly signed a deal with LGD to supply flexible AMOLED displays for its upcoming iWatch product. It was said that Apple wants to produce 3-5 million units per month, which pretty much uses all of LGD's flexible OLED capacity. While Apple may be looking for more suppliers, it's likely that if this is true than LGD will indeed want to increase its production capacity soon.
