BOE Technology Group Co., Ltd. is hopeful of clinching a deal to sell millions of additional LCD panels to LG Electronics when its executive team visits the TV maker later this month.
According to a report in The Elec, LG wants to expand its purchases from BOE, in order to reduce its reliance on another leading Chinese manufacturer, TCL CSOT, which currently supplies it with LCD panels.
BOE wants to sign a deal too, for its facing a tough environment where consumer demand for televisions remains somewhat tepid. During the first half of the year, TV manufacturers stocked up on LCD panel inventories as a result of uncertainty over U.S. President Donald Trump’s tariffs.
Omdia analysts told The Elec that BOE supplied 44% of the LCD TV panels acquired by LG Electronics in 2024, but that number is set to drop to 40% this year. That’s because it has increased its purchases from alternative supplies, such as TCL CSOT and Sharp, to 10% and 6% respectively, up from 8% and 4% the year before.
The remainder of LG’s LCD panels last year were supplied by its subsidiary, LG Display, but that organization has now exited the business after selling its last remaining LCD manufacturing facility in March, to TCL CSOT.
However, LG’s top executives have now decided to cap the number of LCD panels the company purchases from TCL CSOT, because its parent company TCL Electronics is one of its major rivals in the TV industry, and it doesn’t want to keep doing it any favours.
But LG may face difficulties in negotiating a better price with BOE, for LG Display helped to act as a kind of “balancing player” in terms of LCD panel pricing, prior to its exit. LG has now lost that leverage, The Elec explained.
As a result, LG has to engage in delicate negotiations with BOE as it tries to restructure its LCD panel supply chain.
BOE’s executive team will also pay a visit to LG’s rival Samsung Electronics, which also wants to negotiate a new contract for a large volume of LCD panels, it was reported earlier this month. Samsung wants to buy as many as 20 million units over a three-year period, as it also wants to reduce its reliance on TCL CSOT. Like LG, it formerly acquired large volumes of LCD panels from LG Display.
For BOE, this is all good news, as the proposed deals would help it to expand its market share at the expense of TCL CSOT. Besides the Korean companies, it also counts the Chinese firms Hisense and Skyworth among its major customers.
