Katarzyna Petru
LG Electronics is preparing for important talks with BOE Technology Group – all to buy millions of additional LCD panels and become independent from its… competitor.
According to The Elec, a BOE delegation will visit LG later this month. The goal is to finalize a large deal that will allow LG to reduce purchases from TCL CSOT – the company that not only supplies them with panels but also… produces its own televisions and competes for the same market.
For BOE, this is also an opportunity. Demand for televisions is weak, and at the beginning of the year, manufacturers stocked up warehouses in fear of new tariffs from the U.S. Every new deal is a chance to make up for losses.
TCL is taking a break – BOE is set to take its place
In 2024, BOE provided 44% of the LCD panels used by LG. This year, that share is expected to drop to 40% as LG has increased purchases from ChooseTV CSOT (to 10%) and Sharp (to 6%).
So far, LG could also rely on its own subsidiary, LG Display, but it sold its last LCD panel factory… to none other than ChooseTV CSOT. The result? LG is left without its "safety net," and now has to carefully juggle partners to avoid inadvertently strengthening the competition.
Negotiations Will Be Difficult – LG is Losing Its Edge
Until now, LG Display has acted as a buffer and helped keep LCD panel prices in check. Now, without that alternative, LG is losing its negotiating position against BOE. And BOE knows this well.
The company wants to extract maximum value from the situation. And not just from LG – a BOE delegation will also visit Samsung. Samsung is also looking for an alternative to TCL CSOT and plans to purchase as many as 20 million panels over the next three years.
BOE is playing for a big piece of the pie
If BOE signs new contracts with LG and Samsung, it will take over a significant portion of the market that was previously controlled by TCL CSOT. In addition to the Koreans, BOE is also working with Chinese giants – Hisense and Skyworth.
The game is about big numbers and even bigger influence. And everything suggests that BOE might come out victorious from this turmoil.
Source: hdtvtest
