Taiwanese LCD monitors made in China are projected to account for 29 percent of Taiwan's total output this year, up one percent from last year, according to the Market Intelligence Center (MIC, 市場情報中心), a research unit of the Institute for Information Industry (資策會).
An MIC analyst attributed such a large increase to Taiwanese makers' attempts to reduce production costs and to expand their market share in China.
"The gross margin of LCD monitor production is less than that of [tube display] monitors and it is therefore the Taiwanese LCD monitor makers that are largely migrating to China to reduce costs," said MIC hardware and semiconductor research director Abel Wang (王勝宏) at an industry seminar yesterday.
While moving production to China has effectively reduced costs, Wang pointed out that the price of LCD panels would be a critical factor in determining the continuous growth of LCD monitor production, citing that the LCD panel price has been marked up by 10 percent recently as a result of increasing demand. "The continuity of higher [LCD panel] prices will be one of the keys in determining LCD growth in 2002."
Wang estimates that this year's total Taiwanese LCD monitor output including those made overseas, will grow by 70.7 percent year-on-year to US$3.22 billion. Both digital cameras and servers are also expected to see expanded production of 95.5 percent and 30.1 percent this year respectively, he added.
Taiwan's information technology hardware output this year is expected to shrink 10.3 percent to US$42.18 billion due to a fall in global demand, said the MIC's latest forecast
Wang doesn't expect Taiwan's IT hardware sector to secure a tangible recovery until the second half of next year.
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