Smartphones lift flat-panel sector

A stand markets TCL Corp at an exhibition in Beijing. CSOT Corp, a major TCL subsidiary that produces liquid crystal display panels, on Monday announced plans for a high-end panel plant in Wuhan, capital of Hubei province. WU CHANGQING/CHINA DAILY

China's growing appetite for portable smart devices will accelerate domestic innovation and could shorten the product life cycle across the entire production chain, according to industry insiders.

Flat panel display manufacturers will reap more orders as the global smartphone fever continues to attract Chinese technology companies.

"Surging market demand for high-resolution smartphone screens is lifting the sector, to the point where it's become the biggest vertical segment in the panel manufacturing industry, overtaking television panels," said Bo Lianming, executive director and chief operating officer of home appliance maker TCL Corp.

CSOT Corp, a major TCL subsidiary that produces liquid crystal display panels, on Monday announced plans for a high-end panel plant costing 16 billion yuan ($2.6 billion) in Wuhan, the capital of Hubei province. The facility will open in 2016 with an annual production capacity of 88 million units, according to a company statement.

Bo hopes the company's ambitious LCD project will offer a technological edge to the Guangdong-based multinational as it goes up against market leaders from Japan and South Korea.

TCL's new Wuhan factory will be near Lenovo Group Ltd's largest mobile device assembly plant. The world's largest personal computer producer is targeting 100 million mobile device shipments annually.

Because of the mobile shift in the market, flat panel-display manufacturers are refocusing their attention on small and medium-sized displays.

"The trend is especially apparent in China, where there are growing numbers of new low-temperature polysilicon and organic light-emitting diode plants," said a report from NPD DisplaySearch, a California-based industry consultancy.

Global mobile display revenue is set to exceed revenue in the TV display sector for the first time this year, according to NPD DisplaySearch. The flat panel displays used on mobile devices will generate 42 percent of global total revenue in 2014, surpassing LCD TVs' share of 37 percent, the firm said.

"With strong growth in tablets, high-end notebooks and smartphones - especially high-resolution and wide-viewing angle displays - mobile devices are leading the growth of the flat-panel display sector," said David Hsieh, vice-president of NPD DisplaySearch.

Local display manufacturers, such as BOE Co Ltd, Visionox Co and Tianma Micro-electronics Co, are all looking to expand production capacity to meet demand.

China is the world's largest smartphone maker and consumer in terms of shipments.

Last year, more than 350 million new smartphones were shipped in China, about one-third of the global total, figures from IDC show. Local vendors such as Xiaomi Corp, Lenovo and TCL are quickly gaining market share by frequently unveiling new models, it said.