Prices of OLED panels for smartphones will drop from extreme oversupply caused by the COVID-19 pandemic and sanctions against Huawei, according to UBI Research.
The global smartphone market slowed in the first half of 2020 due to the COVID-19 pandemic, which led to demand for OLED to fall. In the third quarter, 113 million smartphone OLED panel were shipped, down 17.9% from a year ago. The fourth quarter is expected to be similar, UBI Research CEO Choong Hoon Yi said.
However, Apple’s expanded of OLED is a positive factory, Yi said. This year, around 50% of iPhones will use OLED, but this is expected to increase to 75% in 2021 and 100% in 2022.
Due to COVID-19, UBI Research earlier estimated that 180 million iPhones will be produced this year but this has been increased to 220 million units. Apple completely overcame the pandemic, Yi said.
But Huawei’s declining smartphone business is expected to negatively affect the global smartphone OLED panel market. Huawei accounted for 53.4% of China’s smartphone OLED panel market in the second quarter __ meanwhile, Oppo, Vivo and Xiaomi each accounted for 18.6%, 14.8% and 8.3%. Huawei’s OLED use surpasses that of the combined number of its three compatriots.
Huawei sold 51.83 million smartphones in the third quarter, according to Gartner, down 21.3% from a year ago. People familiar with the matter earlier told TheElec that the Chinese tech giant is expected ship only 50 million smartphones in total in 2021.
BOE is also attempting to enter the iPhone OLED supply chain. It failed to pass Apple’s review this year but will reattempt next year. If it succeeds, this may put pressure on Samsung Display and LG Display to cut OLED panel prices.