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HKC Readies Gen 8.6 LCD Fab for Mass Production
June 10, 2019
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HKC signed an agreement with the government of Mianyang, China in April of last year and has been constructing its second Gen 8.6 LCD fab.  The main fab building was expected to have finished concrete pour work at the end of May, along with the roof capping.  The fab complex, which will cost $3.47b when fully built-out is among the biggest construction projects in the city, which is also home to the BOE Gen 6 B11 OLED fab also under construction. Currently, HKC has ~1.1% share of the overall LCD market.  The first HKC Gen 8.6 fab opened in February 2017 and with panel sales beginning about 60 days later.  HKC should end the 2020 year with a 2.2% share of the overall LCD market (capacity), and a 3.8% share of the Gen 8 LCD market.  Looking at just large panel LCD production (Gen 7+), HKC should finish this year with a 3% share of the worldwide market, and by the end of next year should account for ~5.6% of China’s large panel capacity.
 
HKC is also working toward the construction of a 3rd LCD fab in Zhengzhou, although there is some question as to whether it will be another Gen 8.6 fab or a Gen 11, which would be optimized for ultra-large panel production.  While we originally expected that fab to open in 2020, we believe it will more likely be 2021, especially if it is to be a Gen 11 fab, which would take longer to build-out and likely cost more than the $3.5b each that the Gen 8.6 fabs cost.  All in, HKC continues to push capacity expansion regardless of its effect on the industry, and so far, has seen the results to be worth the efforts as it now controls panel production for its own brand.