Apple supplier Samsung Display will invest $11 billion on facilities and research to upgrade a production line by 2025.
The Samsung Electronics unit said that it will spend 10 trillion won on facilities and 3 trillion won on research and development to produce more advanced display screens.
South Korea’s panel makers are struggling to cope with slower liquid crystal display (LCD) demand for TV and smartphones as well as rising competition from Chinese rivals and a shift by major clients to organic light emitting diode (OLED) panels.
The investment in the next five years will be focused on converting one of its South Korean LCD lines into a facility to mass-manufacture more advanced “quantum dot” screens, Samsung Display said in a statement on Thursday.
Samsung earlier said it suspended the LCD production line last month. The company runs six display manufacturing lines including one LCD line in China.
“Our company plans to overcome the crisis of the large-scale display industry through active investments,” Samsung Display said.
The Samsung unit will build a quantum-dot display production line in Asan, which will begin operations from 2021 with an initial monthly capacity of 30,000 panels larger than 65 inches. Production will scale up from there, with a long-term development plan that stretches out to 2025. The investment will help create 81,000 jobs.
Samsung Display launched in early September a voluntary redundancy program for employees at its large display business department in South Korea, Reuters reported earlier.
Samsung and rival LG Display are grappling with a surge of competition from Chinese suppliers such as BOE Technology Group, which in recent years have ramped up liquid crystal display-making capacity and are increasingly making inroads into next-generation screens, Bloomberg reported.
This week, Samsung reported a quarterly profit decline of more than 50 percent.
South Korea’s largest company is the world’s foremost producer of high-margin OLED displays. It faced drop in revenue last year when orders from Apple iPhone XS did not meet customer demands. Samsung Display will shine again if the response for the latest iPhone 11 Pro models is encouraging during the holiday shopping season.