I. Review of Passive LCD Panel Market


(1) Market Scale Change of Passive LCD Panel in Recent 10 Years


Globally, the passive liquid crystal display (TN/STN panel) market reached its peak in 2006 and created nearly $6 billion in annual output value. By 2012, its annual output value was less than $2.5 billion, accounting for only about 40% of the peak annual output value. The changes of TN/STN panel market scale in the last 10 years are shown in Figure 1. Figure 1: Annual output change chart of global TN/STN LCD panel in recent 10 years


The decline of TN/STN panel is mainly due to the rapid occupation of small and medium size TFT-LCD panel in the market of high-end mobile phones and other consumer electronics products, and the recent erosion of OLED panel on the market of medium and small size high-end consumer electronics products. The recession part mainly corresponds to C-STN and high-end STN. As for TN products located at the lowest end of TN/STN panel market, they maintain a relatively stable market scale.


(2) Changes in the global TN/STN panel Market in recent years


Global TN/STN panels are mainly produced in Asia. The total output of the mainland, Taiwan and Japan has accounted for more than 90% of the world's total in recent years. The changes of local output value of TN/STN panel in the top three countries in the world in recent years are shown in Figure 2.




(Note: In the output data of Korea/Japan, the output value of Korea in 2006 and Japan in the following years)


Figure 2: TN/STN Panel Output Map of Domestic Output Change in the Top Three Global Classes in Recent Years


The top three TN/STN panels have their own market share in the world. Taiwan has dominated the market for three consecutive years since 2006; the mainland has been ranked first since 2009; South Korea ranked first in 2005, third in 2006, and quit the top three in 2007. Japan has been ranked third since 2007. In recent years, the change of local output value in the top three of T TN/STN panel is shown in Figure 3.




(Note: In the "Korean/Japanese" data, the data in 2006 are Korean data, and in the following years are Japanese data.)


Figure 3: Change chart of local output in the top three of TN/STN panel in recent years


The annual output value of TN/STN panels produced in mainland China has soared in recent years, and the trend of increase and decrease does not coincide with the trend of rapid decline of global TN/STN panels Market scale, even in some years it has risen against the trend. If we look at the trend of its output change and consider the factors that the price of TN/STN panel has been declining continuously in recent years, we can infer that in recent years, the output of TN/STN panel in mainland China will increase more in the year of its output value increasing year on year, while in the year of its output value decreasing year on year, its output will decrease less.


The reasons for the above phenomena should be at least as follows: firstly, in the process of transformation, foreign enterprises choose to transfer the production of STN panels from their native areas to enterprises located in the mainland of China; secondly, foreign enterprises quicken the abandonment of TN/STN panels, while the "stock market" turns to mainland-based enterprises. Thirdly, in the past three years, the TN panel of the mainland enterprises has increased due to the increase of the "incremental market" such as smart meters, 3D glasses, light-controlled welding masks, etc. Fourthly, the mainland local enterprises are still in the position of market followers and even fillers in the market competition. This position of the mainland local enterprises can reduce the huge risks that market leaders often have to bear, but it will also make the competition weak and the situation faced with embarrassment is inevitable.