S. Korea, US need national OLED display strategy: Jusung chief
By Kim Yoo-chul
The core of today’s high-profile contest between the United States and China is Washington’s aim of trying to curb Beijing’s steady growth in chip-related areas. Especially in artificial intelligence, quantum technology, nanotechnology, quantum computing and data science.
Because even the success or failure of a series of measures currently being applied by the Joe Biden administration, such as its imposition of export controls of the latest chip-making tools needed to manufacture the most-advanced logic chips, it could have a profound effect on the Washington-Beijing tussle moving forward. Some policymakers and experts in Korea believe that there is a possibility that the U.S. may impose export controls on China’s OLED display industry.
Essentially, semiconductors serve as the brainpower in all of today’s digital devices and they are vital to the U.S.’ national defense, as they are used in everything from the latest guided missiles to stealth jets. Within this security context, display screens are viewed as the interface or “eyes” concerning today’s electronics and are used in numerous military applications such as the F-35’s helmet mounts. Like chips, the industrial market, especially for OLEDs is controlled by companies in Northeast Asia.
Despite Beijing keeping a relatively stable display industrial market, which technically means that it can sustain itself without input from the U.S. and its like-minded allies; it is very necessary for policymakers in Seoul and Washington to categorize OLEDs as critical national security assets, according to a top executive at Korea’s leading semiconductor and display parts supplier.
“I can say the brain (semiconductors) and the eyes (displays) are a team. That means the brain supports responsive feedback from the eyes as doing so keeps the two eyes aligned on their target. Once you have better eyes, then you expect to have enhanced brain function. If left untreated, then it could have a negative impact on the brain. From the national security standpoint, OLED displays have significance just like semiconductors,” Hwang Chul-joo, chairman and CEO of Jusung Engineering, told The Korea Times in a recent interview at the company’s research center in Yongin, Gyeonggi Province.
|Jusung Engineering Chairman and CEO Hwang Chul-joo poses during a recent interview with The Korea Times at the company’s research center in Yongin, Gyeonggi Province. Korea Times photo by Choi Won-suk|
Hwang, a legendary Korean businessman who holds more than 3,000 patents, particularly in the semiconductor equipment industry, stressed that high-technology commercial goods that are sourced globally are interdependent.
Given China’s ambitions for a greater global influence in the OLED industry, Hwang said that he does not rule out the possibility that countries relying on Chinese OLEDs would all be adversely affected, causing a domino effect on the global supply chain in the OLED industry. Unlike conventional LCDs, OLEDs do not use backlights; therefore, the usage of OLEDs is flexible and expandable to military assets.
“The long decline of Japan’s display industry, which has undergone repeated realignments, was ironic because of Japanese companies’ continued focus on research projects. Major U.S. companies could be vulnerable to supply shortages from Chinese OLED manufacturers given Beijing’s policy initiatives to assist its homegrown OLED makers to expand OLED applications in commercial products. It’s fair to say that like semiconductors, advanced displays are an integral part of people’s lives,” the top executive said.
The Korea Display Industry Association (KDIA) expects that China will become the world’s largest OLED producer in terms of total output, followed by Korea by late this year at the earliest. Market research firm Omdia said that OLEDs are expected to account for 40 percent of global display revenue by 2029.
“Policymakers need to take a close look at Chinese President Xi Jinping’s recent visit to LG’s OLED facilities in Guangzhou,” Hwang said. With financial and administrative assistance from regional Chinese governments, LG Display and Samsung Display operate OLED factories in the Chinese cities of Yentai, Nanjing, Tianjin and Guangzhou. These facilities could be able to manufacture highly-advanced OLED displays.
While the U.S.’ Universal Display Corporation is leading the market in OLED dopant materials, Japan’s Canon and Nikon are considered the leaders in manufacturing equipment. Korea is home to the world’s top-tier display manufacturers.
IRA’s impact on solar industry
The chairman said Jusung, which engages in the manufacturing of chips, displays, solar cells and OLED equipment, is in the process of pursuing a business transformation, both in terms of revenue sources and client channels, as the company, founded in 1993, must respond to shifting market demands.
“Energy is everywhere. Solar is an inexhaustible source of power and it is also a suitable resource for producing electricity without emitting greenhouse gases. The solar industry is a competitive industry with great potential and Korea is ideally positioned to move forward, strengthening the solar energy value chain given the country’s strength in semiconductors and displays. Jusung Engineering is aiming to roll out tandem-dubbed solar energy equipment, a combination of heterojunction and perovskite technologies, by the end of this year,” Hwang said, adding that the soon-to-be-released solar energy equipment will have increased energy efficiency from today’s 25 percent to 35 percent.
|South Korean President Yoon Suk Yeol, left, U.S. President Joe Biden, center and Japanese Prime Minister Fumio Kishida attend a trilateral summit at the IFEMA Convention Center in Madrid in this June 29, 2022 file photo. Yonhap|
When asked about how the Inflation Reduction Act (IRA) will impact the U.S. solar energy industry, the top executive only said it was in discussions with a lot of clients in the U.S. and Europe to expand its solar cell equipment business.
Plus, the company is also in talks with “major chipmakers” to supply its advanced atomic layer deposition (ALD) technology-based semiconductor equipment, according to Hwang. The ALD-based gear is considered the right fit for profitable foundry chip production and is more accurate compared to equipment using chemical vapor deposition.
The CEO went on to say that its stock prices were significantly undervalued but added that he remained positive about its stock price recovery because the current stock price level is providing a chance to invest in its shares.
In a regulatory filing to the Korea Exchange (KRX), the country’s main bourse operator, Jusung reported 437.9 billion won in revenue last year, with the company generating a 123.9 billion won operating profit, up from 377.3 billion won and 102.6 billion won, year-on-year. The tech-heavy junior Kosdaq-listed Jusung Engineering was traded within a range of 11,000 won and 15,000 won per share in the past quarter, according to KTX data.
“In terms of the level of the company’s stock prices, Jusung is highly undervalued. I would say Jusung Engineering stocks would display strong upside momentum. The only remaining issue is when and how,” the CEO said.