HannStar to open 6G plant next year

HannStar Display Corp (瀚宇彩晶), Taiwan's No. 4 flat-panel maker, said yesterday it will join the ranks of large-sized TV panel suppliers when its sixth-generation factory begins production next year.

"The construction of the 6G plant indicates that HannStar is expanding into manufacturing bigger panels for TVs as the advanced plant will be used to cut 32-inch and 37-inch glass substrates for TVs," HannStar chairman Chiao Yu-chi (焦佑麒) said yesterday.

Chiao made the remark at a ground-breaking ceremony for the company's new plant in the Southern Taiwan Science Park (南部科學園區).

The liquid-crystal-display (LCD) panel player, a major supplier of 15-inch panels used for personal computers, began diversifying its products last year after the construction of its first fifth-generation plant was completed, he said.

Hannstar Display, which trades on the Gretai Securities Market (櫃台買賣中心), the nation's over-the-counter market, rose NT$1.1, or 6.6 percent, to NT$17.7 per share, on the expansion announcement.

The company's new 6G factory is expected to begin mass production as soon as the end of next year, HannStar president Wu Tai-kang (吳大剛) said.

He declined to reveal their investment figures and the full capacity of the new fab.

"Our evaluation is still under way and we haven't reached a final decision," Wu said.

Giving a rough idea of the spending plan, Wu told reporters that a 6G fab with capacity of 90,000 panels a month would cost up to NT$90 billion.

The 5G factory is scheduled to begin mass production next month.

Wu said shipments in January and last month fell short of expectations due a disappointing defect rate.

In January, HannStar shipped about 392,000 units because of fewer working days, but the volume was expected to increase 5 percent last month, driven by strong demand, Wu said.

"A shortage in panel supply is a fact as we can see flat-panel giant Samsung Electronics Co aggressively seeking support from outside," he said.

Some of HannStar's customers even agreed to buy the company's 15-inch panels at a higher price of US$245 per sheet, which is close to the US$260 when the price peaked last year, according to the company.

As long as demand remains strong, Wu said he did not expect to see a supply glut in the second quarter.

Shipments are expected to take off during the April-June period after the 5G plant ramps up production, he added. Seventeen-inch, 19-inch, 23-inch and 28-inch panels will be the company's major products in the first half of this year, he added.