New display technologies (such as OLED, Micro-LED, flexible display, Mini-LED, etc.) have extremely high requirements for the accuracy, uniformity and functionality of film deposition. ALD technology, with its atomic-level film thickness control (0.1A accuracy), high aspect ratio coverage capability and low-temperature deposition characteristics, has become a key equipment to break through the performance bottleneck of display panels. Specific application scenarios include

<s:1> Flexible OLED packaging: ALD can deposit dense films such as Al₂O₃ and SiO₂, with a water and oxygen transmission rate (WVTR) as low as 10⁻⁶ g/(m²·day), solving the problem of packaging layer damage when flexible screens are bent and extending the device life (from 5,000 hours in traditional packaging to over 20,000 hours).

<s:1> Micro-LED mass transfer: Insulating layers prepared by ALD (such as HfO₂) can achieve precise electrical isolation between chips, with yield increased to 99.9%, meeting the requirements of ultra-high-definition display.

<s:1> Touch sensor and electrode protection: The transparent conductive film deposited by ALD (such as ITO/ZnO composite layer) has a square resistance of less than 10 Ω/□, a visible light transmittance of more than 95%, and also features corrosion resistance and scratch resistance.

Ii. Market Size and Growth Potential

The global market is expanding rapidly

In 2024, the global ALD equipment market size reached 6.8 billion US dollars, with the display field accounting for approximately 15% (about 1.02 billion US dollars). It is projected that the compound annual growth rate (CAGR) of ALD equipment demand in the display field will reach 28% from 2025 to 2032, significantly higher than the industry average growth rate (7.34%).

China is the core growth engine: In 2024, domestic display panel production capacity will account for 56% of the global total, and the demand growth rate for ALD equipment will reach 37% (the global average is 15%), mainly due to the expansion of flexible OLED production lines by enterprises such as BOE and CSOT (for example, BOE's 6th generation flexible OLED production line in Hefei needs to be equipped with 8-12 ALD devices per line).

2. Differences in contribution of detailed technical routes

In the oOLED field, it accounts for 60% of the ALD equipment market for displays. The demand scale is expected to reach 750 million US dollars in 2025. Plasma-enhanced ALD (PEALD) equipment accounts for more than 70% because it can deposit high-quality films at low temperatures (< 100℃) and is suitable for flexible substrates.

In the oMicro-LED field, the demand for ALD equipment is growing at the fastest rate (CAGR 45%), and the market size is expected to exceed 500 million US dollars by 2027. It is mainly used for the deposition of insulating and protective layers after the massive transfer of chips.

Iii. Technological Barriers and Competitive Landscape

1. Core technology challenges

o Large-area uniformity control: The display panel size has reached Gen 10.5 (3370mm×2940mm). The ALD equipment needs to achieve a film thickness uniformity of less than ±2%. International giants have solved this problem through multi-chamber parallel deposition technology (such as the Endura® platform of Applied Materials). Currently, domestic equipment has achieved breakthroughs in production lines below Gen 6.

Precursor compatibility: OLED packaging requires the use of high-purity Al(CH₃)₃ (TMA) precursors, with a purity requirement of 99.999%. Domestic enterprises (such as Nanda Optoelectronics) have achieved mass production and supply, but high-end products still rely on Merck of Germany and Linde of the United States.

2. Competitive landscape: International dominance, domestic breakthrough

International giants such as Applied Materials (AMAT), Tokyo Electron (TEL), and ASM International hold over 80% of the global market share for ALD equipment used in displays. Their technological advantages are reflected in production capacity (monthly production capacity per unit > 1,000 pieces) and process stability (operating rate > 85%).

Domestic enterprises such as Northern Huachuang, MicroAdmittance Nano, and Toprun Technology have entered the mid-to-low-end market through "differentiated competition". For instance, Northern Huachuang's flexible OLED packaging ALD equipment has been supplied in bulk to Shenzhen Tianma and Vxinuo at a price of only 60% to 70% of international competitors. By 2024, its domestic market share is expected to increase to 18%.

Iv. Policy and Industrial Chain Synergy Effects

1. Policy-driven domestic substitution

oALD equipment has been included in China's "Six Core Directions of Future Industries", enjoying research and development subsidies (up to 30%) and tax benefits (income tax reduction). Local governments such as Hefei and Wuhan offer purchase subsidies of 10% to 15% for ALD equipment used in display panel production lines to accelerate the localization process.

International trade restrictions (such as the US Critical Export Control List) have forced domestic panel enterprises to give priority to purchasing domestic equipment. By 2024, the proportion of domestic ALD equipment purchased by BOE and TCL CSOT had reached 35%, an increase of 25 percentage points compared to 2021.

2. Industrial chain collaboration accelerates the implementation of technologies

In China, a linkage innovation model of "equipment - materials - panel factories" has been formed: for instance, Microconductance Nano has collaborated with Wanhua Chemical to develop customized precursors and worked with BOE to develop spatial ALD (SALD) technology, increasing the deposition rate to 2nm/min, which meets the mass production requirements of large-sized display panels.

V. Future Growth Points and Risk Warnings

Expansion of emerging applications

o Transparent display and AR/VR: The ultra-thin metal mesh electrodes (line width < 5μm) prepared by ALD can achieve a light transmittance of over 90%, meeting the requirements of AR glasses optical waveguides. The demand for related equipment may reach 200 million US dollars by 2026.

Quantum dot display (QLED) : ALD-coated quantum dots can solve the problem of light-induced attenuation and increase the lifespan by three times. Samsung and TCL have initiated relevant production line verification, and it is expected that stable demand will be formed by 2028.

2. Potential risks

o Technical route substitution risk: Technologies such as inkjet printing and laser stripping may partially replace ALD in flexible packaging applications, and the cost performance of equipment needs to be continuously improved.

o Supply chain dependence: The import dependence on high-end vacuum pumps (such as Pfeiffer) and mass flow controllers (MFC) still exceeds 60%, and geopolitical factors may lead to extended delivery cycles.

Conclusion

The market prospects for ALD equipment in the new display field are broad. Flexible OLED packaging and Micro-LED mass production will become the core driving forces in the short term (3-5 years). In the long term, emerging scenarios such as AR/VR and quantum dot display are expected to open up a second growth curve. With policy support and industrial chain collaboration, Chinese enterprises are expected to achieve a domestic production rate of over 50% for ALD equipment used in displays and increase their global market share to more than 30% by 2030. However, they need to continuously break through technical bottlenecks such as the uniformity of large-scale deposition and the domestic production of core components.