[ET NEWS] Internet giant Google will invest 1 trillion won (US$875.7 million) in LG Display's new manufacturing facilities for flexible organic light-emitting diode displays, according to multiple sources on April 10.

The move is aimed at securing a stable supply of flexible OLED panels for the next version of Google’s modular smartphone Pixel and the development of foldable smartphones amid a global supply shortage of flexible OLED panels, according to the sources. They added that unlike Apple, Google has not asked LG Display to make panels specifically tailored for its devices.

LG Display declined to comment. 

Samsung Display is currently the sole supplier of the flexible OLED panels. Most of the panels will be supplied to Apple and Samsung Electronics this year for the new iPhone and Galaxy S8 lineup. This is expected to cause a global strain on panel supplies.

Google’s investment is large enough to build a new production line for flexible OLED panels. LG Display has two flexible OLED plants, E5 in Gumi City and E6 in Paju City, into which the display maker has invested 1.5 trillion won and 1.99 trillion won, respectively.

The E5 is expected to become fully operational by the third quarter this year, while the E6 will go live in the first quarter of 2018.

The flexible OLED displays for Google are expected to be produced at the E5 plant.

Other details of the anticipated partnership between Google and LGD may change, as the negotiations are still ongoing, the sources added.

If a deal is struck, it is likely to help boost LG Display’s OLED business, which is seeking a bigger foothold in the global small- and medium-sized OLED display sector. LGD is currently the No.1 manufacturer of OLED displays for TVs in terms of production volume, but it still considered an underdog to Samsung Display in the mobile OLED segment due to insufficient yields.

Meanwhile, talks are also reportedly ongoing between Google and LG Display on joint research and development on foldable smartphones.

By Bae Ok-jin (withok@etnews.com) (theinvestor@heraldcorp.com) 
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