According to the research report, the market growth rate of the LCD splicing industry in the first half of the year returned to the 3rd era. Among them, sales in the first quarter increased by 37.1 percent year-on-year. This is in sharp contrast with the market structure of the industry in 2014-2016 where the growth rate was maintained in the 2 era. Industry insiders believe that as the entire economic market gets better, the market demand that was suppressed in previous years is expected to "release the lesson." This is the reason why the current LCD splicing market has increased at a higher rate than in previous years.
The small-pitch LED industry has maintained the "expected" high growth rate. In the first half of the year, the overall LED industry improved. Including the increase in upstream production and income, the expansion of downstream markets, and the further transformation of the entire industry from customization to standardization, the cost reduction brought about has promoted the prosperity of the market. It is expected that the terminal growth rate of nearly 40 percent throughout the year can be expected. At the same time, small-pitch LED screens have also made new progress in developing small and medium-sized commercial conferences and outdoor markets.
Different from the substantial growth of LCD splicing and small-pitch LED screens, DLP splicing products still continue the trend of steady decline in the market. On the one hand, this is due to the competitive relationship between small-pitch LEDs and 1.8-slit LCD splicing. On the other hand, it is caused by the lack of its own "explosion point" in the DLP splicing industry and the calmness of market perception. On the whole, the market versatility of small-pitch LED and LCD splicing and the length of the industry chain have become a more powerful competitive advantage than technological progress.
The LCD splicing market segmentation trend is obvious
The LCD splicing market was further segmented in the first half of 2017. Among them, the 1.8 mm gap product market has entered the growth period, and its sales volume has almost doubled compared with the same time last year, becoming the largest "dark horse" in the market.
1.8mm LCD splicing is a key product for the replacement and market replacement of LCD splicing products. This gap indicator means that products can enter "high-end applications." Represents the added value of the market. It is also the product line with the most intense competition between LCD splicing and small-pitch LED and DLP splicing.
At the same time, the overall gap index of LCD splicing products has accelerated downward. Machines with gaps of 3.5 mm and below account for nearly 70 percent of the market. This is mainly due to the decline in the price of 3.5mm products. Price-driven is the biggest factor in the upgrade of LCD splicing technology standards.
On the other hand, LCD splicing has been slow to improve the size of the unit. Since 2016, the supply of the LCD industry has been tight, especially the large-size unit products have shown a certain market shortage. This resonates with the relatively expensive positioning of the large-size unit itself. Makes the industry unable to promote the large-scale unit size. At the same time, the large-scale unit is not conducive to the application of smaller pitch technology.
From the price point of view, LCD splicing is in a price decline cycle-this is in contrast with the upward trend of the industry's upstream panel price increase and LCD TV product price increase. This contrast is related to the higher self-gross profit of spliced products, which can better absorb upstream price changes. However, the industry believes that the upward trend of LCD prices will end at the end of the year at the latest. Moreover, with the start of a new round of production of large-size lines in 2018, the pace of industry expansion can be expected under the support of prices.
Small-pitch LED display market expands in depth
In the first half of 2017, the small-pitch LED screen market basically ended the "die" shortage adjustment since the third quarter of last year. The market enters the price-driven model again. Product prices in the industry have fallen by 1-2 percent , and the market has further shown an "independent and prosperous posture."
From the upstream of the industry, the LED market is still in a rare stage of prosperity: prices are at a high level, equipment and other costs are in a downward channel, the profit-increasing effect of small brands withdrawing continues, and large factories, whether it is wafers or packaging, are in a period of capacity expansion. However, from the perspective of small-pitch terminal companies, the "supply shortage" in the third quarter of last year was basically eliminated. Although the market is prosperous, companies are more aware of the importance of fully occupying the incremental market in order to form a separate pattern. Therefore, many companies have the motivation to actively reduce prices and expand order discounts.
From the perspective of product form, P1.0 products have entered the harvest period, P1.2 products have entered the generalization stage, P1.5 products have become popular products, and the price war for products above P1.8 is fierce. The overall market structure has been upgraded to a higher level compared with the same period last year. This provides technical support for the prosperous commercial application of small-pitch LEDs in the high-end display and small-pitch LED TV markets.
In the market segment, the security industry is still a "difficult" stage. P1.8 is the main security product, unable to build a cost advantage for LCD splicing, showing market anxiety. However, outdoor landscape applications, such as the field of night economy; ultra-fine pitch stand-alone products, such as small pitch LED TVs; high-end command and dispatch center market and COB technology differentiated product market are all showing a prosperous development.
Overall, under the background of price decline and technological upgrading, the application depth and breadth of small-pitch LEDs are increasing, and the product form is also increasing. Especially in the context of market scale, the "manufacturing chain" of terminal brands has been further streamlined and stabilized. The small-pitch industry has further compressed "customized" colors, showing the characteristics of stable scale and standardized manufacturing. This is conducive to stable supply of small-pitch LED products, lower costs, and enhanced quality control capabilities.
Price war becomes the market hedging center
Since 2017, the average price of small-pitch LED products with the same standard has dropped by 1-2 percent , and the price of LCD splicing products has dropped by 10 percent . The price decline of the two has a similar background: last year, the upstream areas of the two, LCD panels and small-pitch LED dies have experienced price increases, and are currently at a high price stage.
This contrast shows that the downstream industry still believes that "price war" is an unavoidable topic. Even if prices in the upstream market increase and downstream terminals are within an acceptable range, the general trend of price declines must still be maintained.
There is also a "fundamental conflict" in the price war between small-pitch LED and LCD splicing. On the one hand, in addition to targeting landscape and other application markets, p1.8 small-pitch products are particularly concerned with the expansion of the security market. The security market is the basic plate of LCD splicing. On the other hand, applications in third- and fourth-tier cities, especially smart city projects, have become the incremental focus of the large-screen market. At the same time, this field is a must for the splicing of small-pitch LEDs and liquid crystals.
The price war between small-pitch LED and LCD splicing is also a challenge for DLP splicing products. The industry predicts that by this year's low, in order to cope with the challenges of the two, the average unit price of DLP splicing will drop by about 30 percent compared with 2015. And the emerging small-pitch LED products dominated by COB technology, regard the high-end application of DLP splicing as "a must." Under this kind of market conflict, price wars will inevitably become the preferred means.
In short, the large-screen market has increased its overall revenue since 2017, but the price war is overwhelming. There is a strong smell of gunpowder among market brands and among competing product technologies. The overall market is in a superposition of high prosperity and fierce competition; the market brand is under the dumbbell structure with the expansion of the leader's advantages and the rise of small and medium-sized manufacturers; the market segment also interprets the continuous "dual focus" of inventory competition and emerging demand innovation. Big drama!
