According to recent foreign media reports, at the end of May this year, news surfaced indicating that LG Display intended to invest 4 trillion won (approximately $3.5 billion) in South Korea to construct a new production facility for smartphone OLED displays. However, based on LG's latest financial statements, this initial investment is insufficient. The company now plans to further commit an additional 9.6 trillion won ($8.5 billion) to its OLED business. Industry insiders suggest that Apple has played a pivotal role in prompting this significant financial commitment.
It is reported that the second phase of LG Display's investment, totaling 9.6 trillion won, will be split into two distinct components. Of this amount, 5 trillion won will be allocated towards manufacturing mobile OLED display panels, while the remaining 4.6 trillion won will be invested in expanding facilities for producing larger equipment such as smart TVs. From the company's financial disclosures, LG Display currently holds approximately 7 trillion won in cash reserves. Therefore, it is evident that securing additional funding will be necessary for the company to proceed with its second round of investments.
At this juncture, speculation arose regarding Apple's potential involvement. For LG Display to finance its second wave of investments, particularly the portion exceeding 2 trillion won, it would require substantial external support. Given the longstanding rumors about collaboration between LG and Apple, many believe that Apple could be the source of this funding. While both parties have refrained from commenting on the validity of these claims, industry experts suggest that LG will only move forward with its investment plans once formal agreements are signed with Apple.
The benefits of Apple's potential investment in LG Display are straightforward: ensuring a reliable supply of OLED display panels for future smartphones. With the upcoming iPhone 8 set to feature OLED screens, Apple anticipates a surge in demand, which could lead to a capacity shortage. To mitigate this risk, industry sources indicate that LG Display's future OLED panel production may be exclusively allocated to Apple.
However, recent reports suggest that Apple has already made moves to secure its own OLED production capabilities. Consequently, it is speculated that the iPhone 8's OLED screen supply might eventually be sourced from three major suppliers: Apple, LG Display, and Samsung Display. This diversified approach underscores Apple's strategic efforts to ensure a steady supply chain for its innovative devices.
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