On Tuesday, CINNO reported that Apple had signed an agreement at the beginning of April regarding OLED panels valued at 50 million yuan ($7.6 million) with Chinese display maker BOE. Under the arrangement, BOE will reportedly provide display panels for the upcoming iPhone 14 starting in June.
The supply will involve only 6.1-inch OLED panels, with units totaling 50 million. That is to say, BOE will only supply displays for the standard model, while other devices such as the iPhone 14 Max and the iPhone 14 Pro, will still use panels made by Samsung and LG.
All iPhones manufactured previously have used OLED panels made by Samsung and LG. For the iPhone 13 launched last year, Samsung Display supplied 77 million OLED panels, accounting for 73% of the total 106 million units needed. LG Display supplied 29 million panels, accounting for 27% overall. BOE only supplied a limited number of OLED panels for replacement and maintenance purposes.
Since February, BOE has worked to address the shortage of display driver ICs (DDI), and its OLED panel production for the iPhone dropped sharply. The firm might be unable to supply 50 million panels for the iPhone 14, and it is predicted to provide less than 30 million panels this year.
The addition of BOE to the OLED panel supply chain for iPhone 14 production is likely because Apple has adopted a strategy of diversified suppliers. Therefore, Apple deals with any company that can provide the technology it needs. With more suppliers, Apple can achieve a more stable product supply and also obtains advantages in price negotiations with suppliers.
For this reason, a source in the Korean display industry said, “Apple’s cooperation with BOE is to contain Samsung Display and LG Display. Since OLED was first applied to the iPhone X in 2017, Apple has been concerned about the high proportion of supply from Korean companies.”
BOE is increasing its market share in the field of small and medium-sized OLEDs through active investment. According to market research firm Omdia, BOE’s share of the small and medium-sized OLED market increased from 5.6% in 2019 to 8.7% in 2020, and reached 10.5% last year. Omdia expects BOE’s market share to reach 14.8% in the first quarter of this year and 15.5% in the second quarter.