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R&D center to enhance production

AU Optronics Corp (友達光電) yesterday announced plans to invest NT$1.2 billion in establishing a technology center focused on product development, new technologies and manufacturing processes.

"AU Optronics is dedicated to the continuation of innovating advanced flat-display technologies, and the research center will be a key element of the company's blueprint for future success," said Lee Kun-yao (李焜耀), chairman of AU Optronics.

In an effort to become a leader in the sector, establishing a research center is more important than setting up new factories, he said.

"AU Optronics aims to be the No. 1, not only in production amount, but also in technologies," he said.

Over the last five years, the company has invested more than NT$6.6 billion in R&D. It plans to spend NT$10 billion over the next three years.

Lee made these remarks at a press conference yesterday announcing AU Optronics' construction on the 208,000m2 research center is already underway. The new center is located next to its headquarter in Hsinchu Science-based Industrial Park (新竹科學園區).

The complex is scheduled for completion in the second quarter of 2004 and will recruit more than 1,000 engineers.

"The new facility will allow AU Optronics to integrate research resources in an effort to upgrade production efficiency and improve our competitive edge," said Chen Hsuan-bin (陳炫彬), AU Optronics' president.

Our research center can help us to shorten the time to market and differentiate our products from our competitors, Chen said.

Samsung Electronics Co, the world's largest maker of flat panel display, may buy a 10 percent stake in AU Optronics, according to local Chinese-language media reports.

AU Optronics denied the report.

"It's not true ... we haven't had any contact with Samsung recently," Chen said.

Shares of AU Optronics fell NT$0.6 yesterday, or 2.5 percent, to close at NT$23.4 per share on the TAIEX.

Recent merger talks between local flat-panel display companies have aroused speculation that AU Optronics may be interested in merging with Quanta Display Inc (廣輝電子) or HannStar Display Corp (瀚宇彩晶), the nation's No. 4 and No. 5 display-panel makers.

"AU Optronics hasn't ruled out any consolidation possibilities -- but at this moment we don't have any plans," AU Optronics' Chen said.

There are too many players in the sector and heavy competition is cutting into sales, he said.

"Consolidation will be a positive move for the industry," Chen said.
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