OLED—A Call for China to Catch Up?

Apple’s iPhone X with the full-display using organic light-emitting diode (OLED) technology is coming soon. The OLED screen, which is physically flexible with a fast response, wide visual angle and high contrast, is one of the top selling points for this 10-year anniversary smartphone. However, Chinese customers are no strangers to OLED screen due to the OLED adoption on Huawei, OPPO, Xiaomi, Vivo and other local brand smartphones from 2014.

Market Share of Top 5 Smartphone.PNG

(Source: DataYes RoboR Research Platform, Zheshang Securities)

According to a recent survey, Samsung is still the market leader in the OLED industry that accounts for over 95% of the production. To reduce the risk of overdependence on a single supplier, and satisfy the continuous demand from the OLED market all over the world, which is predicted to reach $87.33 billion in 2020 with an annual growth rate of 89.52%, the Chinese government has included the OLED as one of the key support industries in its "Five-Year-Plan" from 2016.

OLED Market Share.PNG

(Source: DataYes RoboR Research Platform, IHS, Soochow Securities)

To realize this 5-year goal, China has kept on expanding the OLED production and improving the technology. The three Chinese screen display industry players--BOE,Tianma and Visionox are expected to reach a monthly production of 137k in all by the end of 2017, and will keep expanding the volume in the next few years. It is projected that China will account for 38% of the OLED production in 2020.

OLED Productiviy Distribution.PNG

(Source: DataYes RoboR Research Platform, OLEDindstry, An Xin Securities)