LG has long supplied display panels for the iPhone but now that Apple is believed to be shifting to OLED panels with the iPhone 8, LG won’t be able to meet its demand for the panels. Samsung has a near monopoly in the small to medium-sized OLED panel market as it currently accounts for over 90 percent of the world’s total OLED supply. Apple will obviously have to source the iPhone 8 display panels from Samsung but LG wants to make sure that it wins back Apple’s lucrative business.
The company said last year that it was going to invest $1.75 billion to increase OLED production. The upgraded production facilities made possible by this investment are expected to come online by next year.
LG has now said that it’s going to invest more than half of its entire capital expenditure budget into new manufacturing facilities for large and small to medium OLED panels. It will invest over $7 billion for this purpose.
The investment will be poured into LG’s joint venture plant in Guanggzhoug, China. It would be the first plant location outside LG’s home country of South Korea where the company will manufacture OLED displays.
The increased production capacity will obviously help LG sell its panels to more customers while promising to meet their volumes. However, it’s not like Samsung is going to sit by and watch its lead evaporate. According to recent reports, Samsung is also making handsome investments to make sure that it remains the undisputed leader in this market.