Variable Vision
Way back in April of 2022 we noted that Visionox (002387.CH) had been trying to develop a system for producing OLED IT products on a Gen 8.6 production platform, rather than on a Gen 6 line, where they are usually produced. There were others doing similar work, particularly Samsung Display (pvt) and BOE (200725.CH), both of whom have gone on to attempt construction of same currently. Visionox itself announced last August that it would be constructing its own Gen 8.6 OLED IT fab, although details were slim. Ostensibly, Visionox was to forego the typical fine metal mask OLED material deposition system, in favor of the company’s proprietary lithography OLED deposition system known as VIP (Visionox Intelligent Pixelization) as a differentiator, but the display grapevine indicated soon after the initial announcement that Visionox was planning to open its first Gen 8.6 line using standard FMM deposition tools and was proposing to initiate VIP at a later stage in order to maximize yield as early as possible.
The Visionox fab is still in the planning stage, which typically requires that at least the initial construction phase be funded. In China , most display projects are financed by both the company involved and the local government, in this case 20% from Visionox and the remainder from local or provincial governments or similar state-run or affiliated funding sources. Depending on the type of project (LCD, OLED, Micro-LED, etc.), project details, and point in the current display-type maturity cycle, funding can usually be plentiful and easily obtained, but as each display technology matures, funding becomes less available and more strict as to the necessity for financial results.
For example, in the early days of OLED display production, with only two OLED producers, China’s BOE was given almost carte-blanche in terms of capital to build an OLED fab to compete with South Korean producers. A number of Chinese provinces competed for the fab, which wound up in Ordos, a city in Inner Mongolia, an unlikely place for a display fab. The location became viable when the local government offered 1 billion metric tons of coal as an additionsl one-time incentive to BOE if they were to build in Ordos, as it was both a potentially valuable asset to the region and a large employer in what is typically an agricultural and mining region of China. We know that BOE sold at least 400 to 600m metric tons of the coal in later years to raise between $1b and $1.6b in capital.
That was ~10 years ago and things have changed as there are dozens of OLED fabs in China and around the globe and while the industry continues to grow, it faces the same maturity funding constraints as other technology industries. In fact, Visionox seems to be facing a difficult time developing funding for its Gen 8.6 IT OLED project, as it would seem that even in China, funding for another fine metal mask deposition OLED fab, even a Gen 8.6 OLED fab, does not seem to generate the funding enthusiasm it did in the past, so Visionox is reconsidering the more difficult task of creating an initial Gen 8.6 OLED line using VIP technology, something that could put China ahead in the OLED space, rather than ‘just another’ FMM fab.
If Visionox were to be successful in developing a commercial IT OLED line using photolithography, the funding sources and the government organizations that supported the project will gain considerable credibility with the state, but even a fine metal mask Gen 8.6 IT OLED fab will put the prject about 2+ years behind competitors, one of whom is BOE who is already being funded for such a project. Perhaps Visionox management got the hint that funding for another Gen 8.8 IT OLED fine metal mask fab might not be forthcoming, while a more advanced VIP fab could see the light of day. The equipment suppliers needed for a fine metal mask type fab were recently invited to a Visionox project preview but remain confused as to what path Visionox is going to take. To use FMM seems pointless and potentially unfundable, while a VIP fsb seems to be attracting the attention needed for the $7.6b fab.
The Visionox fab is still in the planning stage, which typically requires that at least the initial construction phase be funded. In China , most display projects are financed by both the company involved and the local government, in this case 20% from Visionox and the remainder from local or provincial governments or similar state-run or affiliated funding sources. Depending on the type of project (LCD, OLED, Micro-LED, etc.), project details, and point in the current display-type maturity cycle, funding can usually be plentiful and easily obtained, but as each display technology matures, funding becomes less available and more strict as to the necessity for financial results.
For example, in the early days of OLED display production, with only two OLED producers, China’s BOE was given almost carte-blanche in terms of capital to build an OLED fab to compete with South Korean producers. A number of Chinese provinces competed for the fab, which wound up in Ordos, a city in Inner Mongolia, an unlikely place for a display fab. The location became viable when the local government offered 1 billion metric tons of coal as an additionsl one-time incentive to BOE if they were to build in Ordos, as it was both a potentially valuable asset to the region and a large employer in what is typically an agricultural and mining region of China. We know that BOE sold at least 400 to 600m metric tons of the coal in later years to raise between $1b and $1.6b in capital.
That was ~10 years ago and things have changed as there are dozens of OLED fabs in China and around the globe and while the industry continues to grow, it faces the same maturity funding constraints as other technology industries. In fact, Visionox seems to be facing a difficult time developing funding for its Gen 8.6 IT OLED project, as it would seem that even in China, funding for another fine metal mask deposition OLED fab, even a Gen 8.6 OLED fab, does not seem to generate the funding enthusiasm it did in the past, so Visionox is reconsidering the more difficult task of creating an initial Gen 8.6 OLED line using VIP technology, something that could put China ahead in the OLED space, rather than ‘just another’ FMM fab.
If Visionox were to be successful in developing a commercial IT OLED line using photolithography, the funding sources and the government organizations that supported the project will gain considerable credibility with the state, but even a fine metal mask Gen 8.6 IT OLED fab will put the prject about 2+ years behind competitors, one of whom is BOE who is already being funded for such a project. Perhaps Visionox management got the hint that funding for another Gen 8.8 IT OLED fine metal mask fab might not be forthcoming, while a more advanced VIP fab could see the light of day. The equipment suppliers needed for a fine metal mask type fab were recently invited to a Visionox project preview but remain confused as to what path Visionox is going to take. To use FMM seems pointless and potentially unfundable, while a VIP fsb seems to be attracting the attention needed for the $7.6b fab.
RSS Feed