How Innovative Is China in the Display Industry?

Investment Rating - The report does not explicitly provide an investment rating for the display industry. Core Insights - China's share of global liquid crystal display (LCD) production has reached 72 percent, while its share of organic light-emitting diode (OLED) production has surpassed 50 percent, both showing significant growth from under 1 percent a decade ago [8][10][12]. - Analysts project that from 2020 to 2027, China's global share of capital expenditure (CapEx) investments in display technologies will average about 85 percent, with Chinese companies accounting for over 90 percent of the sector's CapEx by 2027 [7][27]. - The R&D intensity of top Chinese firms in the display sector has increased by 646 percent over the past 10 years, compared to a 67 percent increase for U.S. firms [8][39]. - Chinese display maker BOE has received an estimated $3.9 billion in subsidies from the Chinese government over the past 12 years, significantly impacting its market position [8][9]. - The aggressive subsidization of the display industry in China has led to reduced prices and profitability, driving many foreign competitors out of the market [11][12]. Summary by Sections China's Display Industry - Over the past two decades, China's share of the LCD market has grown from virtually nil in 2004 to 72 percent today, while its share of the OLED market has increased from 1 percent in 2004 to over half today [20][22]. - The scale of China's overall display industry has experienced a compound growth rate of 21.6 percent from 2012 to 2022 [20]. Innovation Inputs to China's Display Industry - R&D intensity for BOE and TCL Electronics was reported at 4.9 percent and 4.0 percent respectively, lower than Samsung's 8.1 percent but higher than Sharp's 3.5 percent [39]. - Chinese companies have significantly increased their patent filings, with BOE being the fifth-largest filer of patents to the Patent Cooperation Treaty (PCT) system in 2023, filing nearly 2,000 patents [45]. Company Case Studies - BOE Technology Group Co., Ltd. accounts for 88 percent of its operating revenues from displays and has expanded its network across 20 countries [50]. - TCL has established itself as a leader in the MiniLED industry and has won multiple awards for its innovative products, including the CES 2023 Innovation Awards [54][55].