Securing the Future: The Battle for America's Flat Panel Display Industry

Estimated reading time: 10 minutes

The production and sourcing of flat panel displays (FPDs) have become a focal point of concern, particularly regarding national security. In this interview, Jim Will, executive director of the U.S. Partnership for Assured Electronics (USPAE), provides insights into the essential role of FPDs, including liquid crystal displays (LCDs) in defense systems and everyday technology.

He discusses the implications of America's dependence on Chinese manufacturers for these critical components, raising alarms about supply chain vulnerabilities amidst rising geopolitical tensions. As the industry faces significant challenges, including the recent shutdown of a Japanese LCD panel manufacturing facility, Jim discusses potential strategies for enhancing domestic production capabilities, the urgent need for government involvement, the complexities of supply chain resilience, and the future of U.S. electronics manufacturing against the backdrop of intense global competition.

Marcy LaRont: Jim, you authored a piece on the domestic production of flat panel displays, something which is critical to national security. Can you explain more about that?

Jim Will: Flat panel displays are ubiquitous in our lifestyle. FPDs are on our phones, used in the banking industry, critical infrastructure, and, most importantly, defense systems. They are prevalent in the cockpits of the F-35, F-22, and many other aircraft. They are parts of the command and control systems on the Minuteman or the Navy Aegis system that control interoperability and fire control for missiles.

So much of our electronics supply chain has been offshored and dominated by Chinese sources, subsidized by their government as part of their strategy to control the market.

It's a red flag for the U.S. to buy subsidized components from one of our greatest geopolitical adversaries, particularly in the current environment. With potential conflict in Taiwan, the risks are significant. Denial of access or inability to source displays for our systems is a real concern. An F-35, for example, won’t fly without an LCD display. Similarly, that same system out in the field needs replacement LCDs for the aircraft to be back in service. That’s a considerable concern.

LaRont: With one of the few non-Chinese LCD manufacturing facilities shutting down, the sourcing situation is even worse.

Will: In June, we conducted a flat panel display workshop in Washington, D.C., with 25 industry, academic, and DoD subject matter experts. Keep in mind that public companies, such as Apple and Samsung, will not disclose supply chain details. Displays are particularly sensitive because of the intense competition in that space. Fortunately, USPAE is a neutral, trusted third-party organization, enabling us to work closely with industry to identify and address key issues. During the workshop, we learned that a Japanese LCD panel manufacturer is shutting down its factory. The display sizes they produce are heavily utilized by the DoD, thus forcing the DoD to rely almost 100% on Chinese LCD panels. That’s a significant challenge.

LaRont: Do you have any insight into why the Japanese factory is closing?

Will: Yes, they determined there wasn’t a viable business case due to competition, including that from subsidized Chinese suppliers. This mirrors the broader challenges facing our domestic and assured allied electronics industry.

LaRont: Our heavy dependence on China is well known, and we recognize that, in striving to remain competitive, we contributed to creating this situation. Now we must confront its unintended consequences—and focus on what actions can truly make a difference. But what can be done?

Will: Addressing this requires expanding the assured electronics market beyond defense to include critical infrastructure, establishing assurance standards that create strong demand signals, and building long-term supply pipelines. Changing broader commercial thinking on critical infrastructure is a significant challenge, but essential for lasting impact.  It’s simply not logical to source subsidized electronics from our greatest geopolitical adversary for defense and critical infrastructure.

The FPD workshop produced several initial recommendations. We have existing domestic capabilities, brick-and-mortar facilities that are assembling displays in the U.S. that could be updated to do more of the display work onshore, such as fabricating LCD panels. We could begin producing LCDs in the U.S. within two years to support DoD needs.

USPAE is prepared to lead the next phase of work to address this critical national security risk.

LaRont: I recall a previous conversation we had about critical infrastructure and how electronics are literally in everything these days. FPDs and LCDs definitely fall into that category.

Will: They sure do! They are used in medical devices, banking, and many other applications. Flat-panel displays are increasingly interactive and mission critical. Think about when you touch your device display to respond to questions, you create additional communications pathways which introduces more risks, especially in the context of DoD missions and critical infrastructure.

I don't mean to be overly sensitive here, but open-source reports have shown that components in our solar power grids, which are undeniably part of our national energy infrastructure, include inverter electronics sourced from Chinese providers, some containing unidentified communication devices.

What’s preventing a similar situation with other electronics, including FPDS, that support DoD and critical infrastructure?

LaRont: When we talk exclusively in terms of defense products, it is easy to forget that critical infrastructure encompasses so many things that fall outside of that descriptor. We are talking about financial and energy infrastructure, to two key areas of concern. And there is some good thought leadership that says taking down a country's critical infrastructure is where the next war will be waged.

Will: Yes, I’m aware of similar concerns about exploiting critical infrastructure to disrupt or disable capabilities.  Consider commercial tablet computers, which are adjacent to and obviously include FPDs along with many other components from less assured, subsidized sources. 

Tablets are widely used across our national critical infrastructure, including energy, transportation, healthcare, and defense. They support essential functions including real-time data access, system monitoring, secure communications, and operational control in both civilian and military applications.

USPAE conducted a tablet supply chain risk management mitigation workshop. These days, tablets can be the most powerful computer in some of our military systems. They support key mission objectives and provide key capabilities to our warfighters. 

USPAE’s partner, Exiger, determined that some of the components that supply to tablet computers trace back to Chinese military-sanctioned organizations.

USPAE is leading an effort to ensure our warfighters have access to more assured tablets by adopting a whole of DoD approach that also addresses broader critical infrastructure needs.  This includes driving more secure configurations and aggregating demand for better influence on commercial suppliers and ultimately establishing domestically manufactured equivalents that incorporate a higher proportion of domestic and assured supplier content throughout the supply chain. Intel, for example, a cornerstone of semiconductor technology and capacity, could replace integrated circuits currently sourced from non-domestic and subsidized Chinese suppliers. There are extensive opportunities to leverage domestic or otherwise assured sources for materials, semiconductor manufacturing, packaging and advanced packaging, PCBs through PCBAs, substrates and UHDI, testing and qualification, EMS, and final assembly to build a more secure tablet supply chain. 

LaRont: Does the U.S. government have the resolve and resources to fund and establish a domestic LCD capability?

Will: Given the administrations executive orders, policy directives under Project 2025, and the urgent need to focus on reshoring to establish domestic capabilities, I do believe that the government will realize the necessity.

Of course, China controls the critical minerals that support electronics, shipbuilding, and many other essential defense needs, creating significant challenges. Keep in mind that electronics power and enable our defense systems. Addressing these requires a unified national electronics strategy, with progress ultimately dependent on the government’s prioritization.

LaRont: You recently co-authored an NDIA white paper that discussed domestic infrastructure and the need for supply chain assurance standards to drive demand for that infrastructure that the CHIPS Act and other federal and industry efforts are creating. Please expand on that.

Will: Let me illustrate with a flat-panel display example. Nearly 30 years ago, the DoD established a U.S. facility for manufacturing those, but provided no directive or assurance standard to drive demand to it, leaving the facility without a sustainable pipeline of business. All manufacturing facilities require a consistent baseline of work to cover the operating costs plus scale and appropriate pricing to achieve profitability.

By directing procurement to certified, trusted sources, assurance standards create stable demand, reduce reliance on vulnerable supply chains, and strengthen the resiliency of domestic and allied industry providers.

CHIPS and other federal initiatives, combined with significant industry investment, is strengthening our infrastructure, with DPA Title III enabling domestic ultra high density and substrate PCB capabilities. These efforts address the infrastructure, but the challenge now is creating strong near and long-term demand signals and a work pipeline so the facilities and commercial companies can sustain viable business operations. That's where assurance standards can play a role for flat panel displays (FPD), including supporting DoD’s immediate LCD risks, assuming that government and industry establish domestic capability, they can channel demand to certified sources and away from those subsidized by geopolitical adversaries.

Once assurance standards are established, and industry completes formal certification, government policy and contracting requirements flow down and can ensure industry procures exclusively from these certified sources.

LaRont: Is this a single or a set of standards? Will it be pushed forward by one organization or by many coming together?

Will: I see a set of standards that enable a tiered approach. This effort could be led by a neutral organization with industry and government input. With existing industry-based standards already in place, we're not starting from scratch. There's a strong framework to build on. For example, the automotive industry mandates IATF 16949 to support supply chain assurance and risk management, including planning for disruptions such as cyber threats, while broader cybersecurity needs are addressed through complementary standards like ISO/SAE 21434.

LaRont: In your paper, you mention other standards: the SAE cybersecurity standard, JA7496, and NIST's IR 8419 on blockchain and traceability. You also propose forming a coalition, and working with standards from the IPC, SAE, and NIST would be a strong starting point. What is the next step needed to push forward assurance standards for electronics that supply to defense and critical infrastructure, including FPD and LCDs?

Will: As far as an industry coalition, there’s significant interest and many potential partners, but the key next step is to harness that interest and build it into a coordinated effort that works directly with the government and the DoD.

LaRont: Is that where you are right now?

Will: Yes, that's the opportunity. With IPC standards, such as 1791 Trusted Electronic Designer, Fabricator and Assembler Requirements, and the others you mentioned, there's a great framework from which to begin.  Let’s not forget about DoD’s Trusted Foundry Program, which provides a means to assure integrity and confidentiality for integrated circuits, from design to packaging to test.

LaRont: Jim, how does the issue of trade tariffs in the U.S. play into this?

Will: Tariffs are a highly dynamic issue at the moment, making it difficult to provide a definitive answer. My understanding is that the administration is working to strengthen and revitalize our domestic electronics and defense industrial base supply chain.

Tariffs on microelectronics must be carefully balanced. Establishing domestic microelectronics capacity is a long-term effort—building a facility can take up to two to five years and require multi-billion-dollar investments. Reaching the scale needed for the facility to operate as a viable business takes even longer. Given these timelines and the significant upfront costs, tariffs can pose challenges through potential increase in input costs to sustaining operations and competitiveness during the build-up phase.

LaRont: Is there a call to action for industry members and citizens?

Will: Yes, there is. In collaboration with industry and the Global Electronics Association's advocacy team, a call to action initiative with several key recommendations was created at this year’s IPC APEX EXPO event. The goal is to roll it out this fall, aligning with the priorities of the new administration and leaders. With ongoing federal investments in critical minerals, shipbuilding, and other initiatives, there is clear momentum toward rebuilding a robust industrial base powered by domestically produced electronics. Now is the time to address a national electronics strategy.

This Call to Action includes recommendations for several shovel-ready projects that can deliver measurable results within two years, ensuring early, visible successes in strengthening U.S. electronics manufacturing.

LaRont: Jim, we'll certainly be paying attention as communication, directives, and opportunities come down the line.

Will: Great. Thanks, Marcy.