Equipment demand for the production of LCD panels is unlikely to pick up in the short term, as an oversupplied market is discouraging panel makers from expanding capacity and making major equipment upgrades, according to sources at LCD equipment makers.
A number of panel makers including Samsung SDI, LG Display, and China-based China Star Optoelectronics Technology (CSOT) and Tianma Micro-electronics have already built sufficient 8.5G production lines. Though the companies have plans to further expand capacity, large-scale capacity expansions are unlikely to take place in the next three years due to an ongoing oversupply in the market and price falls for large-size TFT LCD panels, the sources pointed out.
In addition, panel makers' focus on Ultra HD TV panels has made limited contributions to demand for new production equipment, as developing the product line does not necessarily require major equipment upgrades, the sources said.
Although equipment demand coming from the touch-panel display industry is strong, expenditures on equipment for the manufacture of touch panels are relatively small compared to those on production equipment for large-size TFT LCD panels, the sources indicated.
In other news, Taiwan-based LCD equipment specialists including Mirle Automation and Gallant Precision Machining (GPM) have seen their sales performance negatively affected by panel makers' cautious attitude toward capex in 2013.
