Samsung Display is considering suspending one of its liquid crystal display (LCD) production lines due to oversupply issues.
At the moment, the sub division of Samsung Electronics currently operates two LCD production sites in South Korea, as well as one in China.
But there is an oversupply problem. This was evidence earlier this month when research house IDC warned that there had been a worldwide slowdown of smartphones shipments, as evidenced by the latest financial reports from the likes of Apple etc.
There has been a slowdown in the shipments of televisions in recent times as well, which is not helping matters.
“Samsung Display has been adjusting the production output and facility operation due to oversupply and worsening profitability, and we are still considering the suspension of the line, but nothing has been decided,” the company was quoted by Reuters as saying in a statement.
The LCD oversupply issue for Samsung is not being helped by increasing competition from Chinese rivals, as well as a shift towards more advanced OLED (organic light emitting diode) panels.
Local rival LG Display for example has recently converted one of its LCD production lines to an OLED production line.
Reuters reported that LG Display is also considering various scenarios for its remaining LCD production line in South Korea, quoting Chief Financial Officer Suh Dong-hee at an earnings briefing last month.
As far back as 2012 Samsung Electronics was said to be considering options for its LCD business amid a market slump and shift toward OLED displays.