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Samsung, LG Monitor Middle East Crisis Impact on Display Production Costs

The CEOs of Samsung Display and LG Display stated they are closely watching the US-Iran conflict for potential economic fallout. They are concerned a prolonged war could cause inflation and significantly increase raw material costs. This comes amid existing industry pressure from rising memory chip prices driven by AI demand. Both companies emphasize the need to reduce production costs and maintain competitiveness in a challenging market.

Key Points: Samsung, LG Watch Middle East Crisis for Display Cost Impact

  • CEOs monitoring Middle East conflict fallout
  • War could trigger inflation and higher costs
  • Rising memory chip prices already a challenge
  • Focus on reducing production costs
  • Assessing impact on display panel demand
2 min read

Samsung, LG display arms closely watching fallout of Middle East crisis

Samsung Display and LG Display CEOs express concern over US-Iran war potentially driving inflation and raising raw material costs for display panels.

"If the war lasts longer, the price burden of raw materials will rise significantly - Yi Chung"

Seoul, March 12

Heads of South Korean display makers said on Thursday they are closely monitoring the potential fallout of the US-Iran war amid concerns that the Middle East conflict could trigger inflation and push up production costs.

"If the war lasts longer, the price burden of raw materials will rise significantly," Samsung Display Chief Executive Officer (CEO) Yi Chung told reporters ahead of the general meeting of the Korea Display Industry Association held in Seoul.

"While conditions are not favourable due to rising memory chip prices, the war between the United States and Iran is expected to lead to inflation, making the situation even more difficult in the second half," Yi said, reports Yonhap news agency.

The outlook followed industry concerns that rising global memory chip prices amid the artificial intelligence (AI) boom may lead smartphone makers to reduce shipments due to higher costs, eventually weakening demand for display panels.

"(The performance) of memory chip producers may be strong, but clients using memory chips are facing challenges," Yi added. "It is crucial (for companies) to reduce production costs and cooperate with partners to enhance competitiveness."

LG Display CEO Jeong Chul-dong said his company is also closely monitoring the situation in the Middle East, although the conflict has not yet had a direct impact on the company.

"The prices of finished products are rising due to higher memory chip prices, and we are currently assessing what impact it may bring," Jeong said. "We plan to make moves in response to changes in memory chip supply."

Jeong noted the company will continue efforts to enhance its financial health and generate stable profits to deliver solid performance in the first half, said the report.

- IANS

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Reader Comments

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Priya S
Global conflicts affecting local prices... story of our lives. My brother was planning to buy a new Samsung phone for Diwali. Might have to advise him to buy sooner if prices are going to hike. Thanks for the heads-up in the article.
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Vikram M
While I understand the business concerns, the human cost of the war is far greater. The article focuses only on inflation and production, but what about the people suffering? A more balanced perspective would be appreciated.
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Rohit P
This is why we need to push harder for 'Make in India' in electronics. Over-reliance on global supply chains from volatile regions makes us vulnerable. Jio and others are trying, but we need more scale in display and chip manufacturing.
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Sarah B
Working in procurement for a retail chain. This news is a direct alert for us. We'll have to reassess our inventory and pricing strategies for the festive season. The second-half forecast looks tricky.
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Ananya R
AI boom driving up chip prices, now war adding to inflation... it's a perfect storm. Hope Indian companies like Micromax and Lava have some buffer or alternative plans. The common man just wants affordable phones that work.

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