Hon Hai Brings Chicken Blood 200 Billion Yen to Sharp OLED Line
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Sharp (China) Public Relations Department related person confirmed the news to reporters on the same day. According to an announcement released on the Sharp Japan official website on March 30th, Sharp's net income from the capital increase after deducting related expenses from Hon Hai is estimated to be approximately 384.527 billion yen. There are seven major uses, of which 200 billion yen is invested in OLEDs. For the OLED industrialization-oriented technology development investment, mass production equipment investment, etc., it is estimated that the expenditure period from July 2016 to June 2019 will start mass production of OLED panels in the first half of 2018.
Li Yaqin, deputy general manager of Quzhi Consulting, told this reporter that this investment is more than 100 billion yuan. Using Sharp's Japanese technical team, it is expected to launch a small 6-generation OLED panel production line. The monthly production capacity is about 10,000 large OLED screens. In 2019, it will be available for Apple to supply the next-generation iPhone's mobile phone screen. 
Press Sharp to restart
Sharp's operating profit for fiscal year 2015 is a loss of 170 billion yen. Hon Hai, the world’s largest electronics foundry, will increase its capital to Sharp by 388.8 billion yen and Sharp’s shareholding by 66%. The two sides formally signed their contracts on April 2. This capital increase is used for seven purposes to speed up the technological and operational innovations of “100-year Sharpâ€, just like pressing the “restart†button.
In addition to the 200 billion yen investment in OLED, the remaining six applications include: 60 billion yen in investment to enhance the clarity, yield, and next-generation technology development of small and medium size LCD panels; and 40 billion yen in consumer electronics products. Expanding the Internet of Things (IOT) business and transforming business models; investing 8 billion yen to transform the solar cell business into a solution area; investing 10 billion yen to expand high-value-added electronic components for automotive, industrial and Internet of things Invest 40 billion yen for business solutions, including investment in robotics; invest approximately 26.5 billion yen, focus on Japan, Asia, and China, increase brand value in key regions, and increase investment in R&D for new planning projects.
From the above seven uses, OLED investment is a top priority. Sharp announced that OLEDs (Organic Light-Emitting Diodes) can produce display devices that are thinner, brighter, and more vivid than backlight LCD devices. Therefore, following LCD devices, the future is expected to be Cutting-edge display devices are used in smart phones, on-vehicle displays, and ultra-thin TVs.
"Competitive companies have already achieved mass production of OLED liquid crystal display devices on mobile phones. In the future, they are expected to replace liquid crystal display devices and gradually expand their market share in LCD products." Sharp said that from the data, it is expected that the 2020 OLED market The scale will reach US$43.9 billion, compared to the average annual growth rate of 16% in 2014.
Sharp's "competing company" should be Samsung. Li Yaqin said that Samsung's 2015 OLED mobile phone screen shipments have reached 250-260 million units, and shipments this year are expected to increase to 300 million units.
Launched OLED scramble for Apple orders
"Father of LCD" Sharp's large investment in OLED, meaningful. Hon Hai’s marriage to Sharp has prompted Sharp to accelerate its investment in OLEDs. The goal is to compete for orders from Apple’s next-generation iPhones.
Sharp’s announcement on March 30 pointed out that the major smart phone manufacturers in the industry have planned to put products using OLED display devices on the market before 2018 to replace the currently used liquid crystal display devices. This trend means that LCD product market changes.
“Our company owns independent IGZO technology and high-definition LTPS (Low Temperature Poly Silicon) technology that has been used in liquid crystal display devices, and combines IGZO technology and LTPS technology on a small display dedicated to mobile phones. The low power consumption that OLED displays cannot achieve so far can be realized at a low cost, and in the field of medium-sized liquid crystal products, the OLED display device using IGZO technology consumes less power than the liquid crystal display using amorphous silicon, and its performance is lower. With more superiority, it is inferred that the market will expand. Our company aims to become the world's leading supplier of OLED display equipment by maximizing the company's accumulated LCD screen technology,†said Sharp.
Last month, Apple's new product release revealed that the IPhone will use a flexible OLED screen in 2017 at the earliest.
Sharp said that in the future, the market for OLED screen products will also expand rapidly, and Sharp's LCD products with advantages will also coexist with it for a long time. "In the future, smartphones and tablets in the high-end segment will generally adopt flexible OLED displays that can be folded and bent like paper, while mobile phone handsets in the low-end segment will continue to use liquid crystal displays."
Strive to trial production in 2018
The reporter learned from Sharp's announcement that Sharp plans to develop the technology necessary for running the OLED trial production line in mid-2017, and to conduct mass production equipment procurement, etc., in order to establish the product volume production technology and commit to the pilot production line. Mass production begins in the first half of 2018. The investment amount and production capacity will be determined according to the future design. The specific concept is as follows.
The newly-built R&D production line, pilot production line, and mass production line for realizing mass production of OLEDs in the Kameyama Plant. These production lines must not only produce OLED products that other companies have already mass-produced, but also produce flexible OLED products. The investment amount for each production line is estimated to be 28 billion yen, 48 billion yen, and 144 billion yen respectively. In terms of the amount of investment in each year, it is estimated that it will be 5 billion yen in 2016, 75 billion yen in 2017, 100 billion yen in 2018, and 20 billion yen in 2019.
Through the aforementioned investment, in 2019, a production capacity target of 10 million units for a 5.5-inch mobile phone screen (68.5 mm in the longitudinal direction and 121.5 mm in the horizontal direction) will be achieved. The company achieved an annual production target of 9,000 million OLED displays for 5.5-inch smartphones and annual sales of 260 billion yen.
Li Yaqin analyzed that if Sharp wants to achieve such OLED production capacity, the current investment of more than 100 billion yuan is more difficult and does not rule out the possibility of additional investment by Hon Hai and Sharp. Regarding the location of the construction, there is another saying in the industry that it will be built next to the Sharp Tenth Generation Line, because there is still an open space there, and Hon Hai is already managing the tenth-generation line with easy staffing.
"At present, Samsung's OLED panel production line has 4.5 generations, 5.5 generations and 6 generations. If all are converted into 6th generation capacity, the monthly production capacity in the first quarter of this year can reach 125,000 large OLED screens. Sharp OLED investment peak is In 2018, it is expected to be officially put into production in 2019, when the monthly production capacity of its 6th generation OLED line is estimated to be more than 10,000 large OLED screens.†Li Yaqin said, so even if Sharp OLED screen is put into operation three years later, it will take more time to catch up with Samsung. .
In order to catch up with South Korea's Samsung, LG's advantages in OLED, Japan Display Company (JDI) has also purchased OLED panel production line equipment. Li Yaqin predicts that JDI's OLED production line will be put into production in the fourth quarter of 2018, with a monthly production capacity of about 30,000 large OLED screens.
Chen Yan, Executive Director of the Japan Enterprise (China) Research Institute, analyzed with the reporter that Hon Hai is the largest OEM company for Apple’s mobile phones and notebook computers. In the future, Sharp’s LCD panels and future OLED panel support will help Hon Hai Easy to take down Apple's OEM orders. The 104-year-old Sharp has good technology and brand. After combining with Hon Hai's huge orders and efficient management, it should not be difficult to achieve a deficit in 3-4 years.
