Analyst: LCD tool sales doubling by 2010, sharing spotlight with PV

June 2, 2008 – Sales of array processing equipment for TFT-LCD manufacturing are expected to more than double between now and 2010 to more than $7.0B, rebounding from significant declines in the past two years — creating a nice boost to suppliers who turned their sights to brighter prospects in the solar market, according to a report from analyst firm The Information Network.

The firm recently projected LCD equipment sales to surge 20% in 2008 to $4.31B, after being “in a tailspin in the past two years” — dropping -15.8% in 2006 (to $4.56B) and -34.3% in 2007 (to $3.00B), effectively reducing the market by half, noted Robert Castellano, president of the analysis firm, in a statement.

In 2008 alone, he projects the LCD litho tool sector “will make up all its lost ground in 2008,” surging 66% following a -48% plunge in 2007.

Sales should increase ~28% in 2009 to about $5.53B, and another 28% in 2010 to $7.09B, Castellano told WaferNEWS.

A supply glut that squeezed the industry since 2006 is expected to turn into a supply shortage in 2H08, with demand outstripping supply by 6.5% for the year. Major projects on tap include Chi Mei Optoelectronics’ 8.5G plant in Taiwan’s Kaohsiung Science Park, and AU Optronics’ 8.5G facility in Taichung, Taiwan. By area, shipments will surge 28.5% to 67M sq. m, he noted. Large-area panel shipments are seen growing 19% this year, vs. 34% in 2007.

This resurgence in LCD tool demand comes at a good time by some suppliers who were getting burned and shifted their focus to the solar market, Castellano notes. “Numerous companies are entering the solar market and neglecting a lucrative LCD market,” he said. The main force behind this trend: Applied Materials, which has a significant presence in LCD manufacturing through its AKT division, but “couldn’t sell their deposition tool to the LCD industry because of the downturn,” so looked for inroads to use it in the solar market for thin-film deposition, Castellano told WaferNEWS. “Now that the LCD industry is ramping, they should be doing very well.” He also pointed to the International Photovoltaic Equipment Association, a newly formed consortium of solar equipment manufacturers. “There is no such entity in the LCD business,” he pointed out. “Everyone is jumping on the bandwagon.”


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