IHS Sees Unit Demand for LCD Display Glass Declining in 2016

Unit demand for LCD display glass used for TVs, monitors, laptops and other “major large-panel applications” will decline in 2016, IHS Technology said in a Wednesday report. But average screen sizes for each application are expanding, “which means display glass area demand will continue to increase, even as unit shipments decrease,” it said. IHS sees “area demand” for glass used in LCD panels rising 13 percent from 2015 to 2018, it said. It also sees average LCD TV screen sizes increasing to 40.8 inches in 2016 from 39.3 inches in 2015, it said. “Because manufacturing LCD glass requires special tanks for the LCD substrates used in processing, the manufacturing cost of LCD glass is higher than for other materials, and tank investment can be a risky proposition for glass makers,” IHS said. “For these reasons, LCD glass manufacturers are looking to increase the capacity of existing tanks, rather than making additional investments in new tanks.” As LCD glass competition intensifies, “panel makers are suffering from module price reductions,” IHS said. As profits decline, major large panel makers “are pressuring vendors to reduce the costs of materials and components,” but also trying “to save on glass costs by manufacturing thinner LCD glass,” it said. Between 2012 and 2014, major panel makers successfully reduced glass substrate thickness to 0.5 millimeters (0.02 inches) from 0.7 millimeters (0.03 inches), it said. Panel makers are now trying to create display glass that is even thinner, it said: “Samsung is the first company out of the gate with these new efforts, but other major panel makers will soon follow.”