There are obvious differences in the Mini-LED market, and there are hidden worries about the large-scale expansion of LED manufacturers.

In the past two years, Apple, Samsung, etc. have deployed Mini-LED products, triggering an investment boom in the industry. Just as LED manufacturers are expanding Mini-LED production capacity in anticipation of the market outbreak, Tianfeng Securities analyst Guo Mingji came out to pour cold water on everyone. It said that Apple will not launch any new products equipped with Mini-LED this year due to cost considerations.

Industry insiders told the author, “Apple’s product strategy has greatly affected the changes in the Mini-LED market. This is not only because its new products increase the demand for Mini-LEDs, but also cause problems with peers. If it no longer launches Mini-LEDs LED new products, large-scale expansion of LED manufacturers will have the problem of overcapacity.”

The market is divided

In recent years, with the launch of the M1 by Apple iPad Pro 14/16-inch new MacBook Pro, as well as Huawei Smart Screen and some high-end notebook series have announced the use of Mini-LED technology, and after Sony, Samsung, TCL have promoted corresponding new TVs, the Mini-LED market demand has shown rapid growth situation.

According to DSCC data, in the high-end notebook market in the fourth quarter of 2021, 14.2-inch Mini-LED led with a 28% share, followed by 16.2-inch Mini-LED with 26% and 14-inch OLED with 17%. For the first quarter of 2022, DSCC expects the premium notebook market to grow 126% year over year to 18.5 million units, with Mini-LED and OLED each accounting for 50%.

Despite the good sales of Apple’s Mini-LED products, there are still big differences in the market, which are caused by cost and yield issues.

Tianfeng Securities analyst Ming-Chi Kuo recently posted that Apple will not launch any new products equipped with Mini-LED this year due to cost considerations.

However, DSCC analyst Ross Young takes a different view, noting that the 12.9-inch iPad After the launch of the Pro, the sales have performed well, and the product line will not need to launch new products with other specifications. However, Young believes that Apple’s Mini-LED iMac Pro is expected to be unveiled this summer. The panel is expected to start shipping in June, and new products will be launched on the market in August and September. The new products will be equipped with 4,000 Mini-LEDs, forming 1,000 local lights.

In this regard, some Apple supply chain manufacturers told the author, “Apple will continue to launch new Mini-LED products this year, but it is not clear which one it is. After all, according to Apple’s strategy, each series of its products will include high, medium and low The price segment covers more people.”

An industry insider admitted to the author, “Apple will not launch notebook products with OLED panels this year, mainly because the performance of OLED panels has not yet met Apple’s requirements. But it is said that Apple is preparing to cooperate with Samsung Display and LGD. Jointly develop OLED panels for notebooks, and may launch related products in two years.”

“At present, the price difference between OLED screens and Mini-LED screens is not very large, but OLED panel technology is relatively mature, and its price may drop faster than Mini-LED screens. At that time, Apple’s notebook series products may be replaced by OLED screens. Mini-LED screen,” the above-mentioned person further stated.

Cost reduction is the key

At present, Mini-LED is in a period of rapid development, and its market is growing rapidly. According to TrendForce’s forecast, Mini-LED backlight TV shipments will be 2.1 million units in 2021, and will challenge 4.5 million units in 2022. Looking at the display, the shipment of Mini-LED backlight LCD displays is estimated to be 51,000 units in 2021, and the shipment will increase to 65,000 units in 2022.

However, high cost will hinder the development of the Mini-LED industry. DSCC data shows that, taking the 12.9-inch tablet used for tablet PCs as an example, the cost of Mini-LED screens is about three times that of traditional LCD screens, and cost reduction has become the key to popularization.

A person from a display manufacturer pointed out, “Whether it is an LED display or a backlight module, the amount of Mini-LED lamp beads is quite large, especially for TVs, a high-end screen can use more than 80,000 LED lamp beads. Low-end screens also need more than 9,000 lamp beads. As long as the cost of Mini-LED lamp beads is slightly different, the multiplication is astronomical. Therefore, if you want to promote the accelerated implementation of Mini-LED applications, cost reduction will be a problem for various companies. issues that have to be considered.”

Tu Menglong, senior director of Ledman Optoelectronics Technology R&D Center, said, “The most important thing for Mini-LED products now is to reduce the cost. Only by reducing the cost can this industry become bigger.” For example, pixel engines like Lehman can be saved by half, which is to reduce costs through technological innovation and R&D breakthroughs.

Jin Zhangyu, chairman of Qianzhao Optoelectronics, said, “Terminal manufacturers must use Mini-LED on mainstream models as soon as possible. Only with this volume can the price be reduced. There is no volume that cannot be reduced.”

It is worth mentioning that in order to diversify supply risks and reduce product costs, Apple is also actively looking for a second supplier of Mini-LED key components. According to supply chain sources, Sanan Optoelectronics, the leading domestic LED chip leader, has recently passed Apple’s certification and is expected to join the supply chain as soon as the second quarter.

The industry pointed out that although the first wave of Apple’s Mini-LED suppliers was won by Fucai, Sanan Optoelectronics’ goal of actively attacking Apple’s Mini-LED backlight supply chain has not changed. .

It is reported that Sanan Optoelectronics has successively cooperated with a number of well-known downstream customers to introduce Mini-LED, and the product application fields include TVs, computers, etc. The company has also stated that it will give full play to the advantages of Mini-LED chip suppliers with scale advantages in the world, and accelerate the promotion of cooperation between Mini-LED and top international terminal application giants.

There are hidden worries about scale expansion

Despite the higher cost of Mini-LED, the current market is divided. However, industry chain manufacturers continue to expand production capacity, especially mainland LED manufacturers.

Recently, Sanan Optoelectronics’ application for fixed increase of no more than 7.9 billion yuan has been reviewed and approved by the China Securities Regulatory Commission. The funds will be used for the Mini / Micro display industrialization project of Hubei Sanan Optoelectronics Co., Ltd. After the project reaches production, new 1.61 million gallium nitride Mini/Micro-LED chips/year, 750,000 gallium arsenide Mini/Micro-LED chips/year (all 4-inch equivalent chips) and 84,000 units/year of 4K display package products production capacity.

The 1.5 billion yuan fixed increase project of Qianzhao Optoelectronics has also been successfully implemented, mainly investing in Mini / Micro and high-efficiency LED chip research and development and manufacturing projects. After the project is completed, it will increase the production capacity of Mini-LED BLU, Mini-LED GB, Micro-LED chips and high-efficiency LED chips with an annual output of 6.36 million pieces.

In addition, Zhaochi also plans to invest 5 billion yuan in Nanchang High-tech Zone to invest in the construction of Mini-LED chips and RGB small-pitch LED display module projects. Among them, about 2.5 billion yuan is planned to purchase 52-cavity MOCVD equipment and corresponding production capacity chips and supporting equipment for the production of gallium nitride Mini-LED chips.

In addition to Sanan Optoelectronics, Qianzhao Optoelectronics, and Zhaochi, HC Semitek, Jucan Optoelectronics, Huayin, Ruifeng Optoelectronics, Nationstar Optoelectronics, Jufei Optoelectronics and other manufacturers have also increased investment to further expand production capacity .

However, after large-scale expansion, will there be excess capacity of Mini-LED chips? In this regard, industry insiders said, “Although the current Mini-LED production capacity is in short supply, the current large increase in investment by domestic manufacturers will inevitably lead to the risk of overcapacity. When demand slows down, the substantial increase in production capacity will lead to overcapacity and lead to price wars. It will affect the profitability of the manufacturer.”

In fact, in the past few years, the LED chip industry has also experienced the stage from the market outbreak to the expansion of production by manufacturers, resulting in a price war caused by overcapacity, which has led to a decline in the profitability of LED manufacturers such as Huacan Optoelectronics and Qianzhao Optoelectronics, and the net profit has increased year after year. loss situation. And the LED manufacturers who have just recovered from the magic have greatly expanded the production capacity of Mini-LED, which may repeat the situation of the price war caused by the overcapacity of LED in the past few years!