Korea's display industry is grappling with higher logistics and raw material costs from the United States–Iran war, lower shipments by finished goods customers due to rising memory prices, and pressure to cut panel prices. Heads of Korea's display companies noted that if the situation drags on, the burden will grow, and said they will closely monitor developments.
On the 12th at Lotte Hotel World in Songpa-gu, Seoul, Samsung Display President Lee Cheong met with reporters at the Korea Display Industry Association (KDIA) annual general meeting and said, "Because of the (United States and Iran) war, logistics costs will naturally rise, and then energy prices will go up," adding, "There are many raw materials such as films made from oil. When this becomes reality, cost pressures will increase."
He added, "Since everyone will inevitably face the same situation, the key at this point will be how to gain more competitiveness," and said, "It will be important to innovate the cost structure and work together with partners to overcome this."
He was saying that Iran's blockade of the Strait of Hormuz amid the Middle East war, which is pushing up oil prices and logistics costs, could threaten this year's outlook for the display industry.
Lee also voiced concern about rising memory chip prices. He said, "I don't think (the rise in memory prices) will be resolved in a short time," adding, "Those who use memory chips are having a very hard time, and how they overcome this will be crucial."
Lee said the company is also pushing ahead with 8.6-generation IT organic light-emitting diodes (OLEDs) without setbacks. He said, "(The 8.6-generation OLED) is progressing well overall," adding, "Because it will be supplied for IT, it's important for the market to heat up again. Internal discussions are proceeding as planned." In January this year, Samsung Display shipped the industry's first paid samples of 8.6-generation OLEDs to a customer.
The 8.6-generation uses glass substrates about 2.25 times larger than the existing 6th generation to boost production efficiency and cut costs. Aiming for mass production this year, Samsung Display said in Apr. 2023 that it would invest about 4.1 trillion won to build a production line with a monthly capacity of 15,000 sheets.
Since March last year, Lee has served as the 10th head of the Korea Display Industry Association, succeeding his predecessor, Samsung SDI President Choi Joo-sun (former Samsung Display president).
On the same day, LG Display President Jeong Chul-dong also met with reporters and, regarding the fallout from the United States–Iran war, said, "There is no impact yet, but if it lasts longer, I think there will be," adding, "We will keep a close watch (on the situation) and manage it."
He also addressed rising memory chip prices, saying, "The problem is that finished goods prices are going up because of memory prices," adding, "We are examining what impact this will have, and we plan to respond so that memory supply and demand are balanced."
Jeong offered a positive outlook for LG Display's results this year. He said, "We are carrying out structural improvement centered on OLED. With a strengthened structure, we are generating stable profitability," adding, "I think we will likely deliver good results in the first half as well." Last year, LG Display returned to the black for the full year, but it posted a loss in the first half.
He also said the company is preparing for new businesses. "We are researching foldables and various other technologies, and we will respond based on when commercialization becomes visible," he said, adding, "You can assume we are doing everything that various competitors are doing."