Unaxis to open panel-equipment plant

Unaxis Holding AG, one of the world's largest flat-panel-display equipment suppliers, yesterday announced a NT$1 billion expansion plan in Taiwan to keep pace with local companies' voracious appetite for next-generation equipment.

The new investment comes as Taiwanese flat-panel makers, led by AU Optronics Corp (友達光電), are playing a bigger role in the world's liquid-crystal-display (LCD) sector in terms of supply and capital expenditure.

"Taiwan is not only the place you have to go, but also a place you have to be," the Swiss company's chief executive, Heinz Kundert, said during his speech for the groundbreaking ceremony of the new manufacturing line at Chunan Science Park in Miaoli.

Unaxis, which supplies Taiwan's two largest flat-display panel makers, AU Optronics and Chi Mei Otpoelectronics Corp (奇美電子), said NT$450 million of the new money would be spent his year.

Taiwanese suppliers of LCD panels plan to invest heavily in new facilities this year by grabbing half of the world's total investment of US$9.42 billion in the sector, outpacing most of their South Korean rivals, market researcher DisplaySearch predicted in January.

Taiwan is also expected to lead in capital expenditure next year, DisplaySearch said.

AU Optronics and Chi Mei plan to spend NT$85 billion and NT$48.5 billion, respectively, on new facilities this year.

In response to its local customers' plans to build advanced fabs needing larger glass panels and equipment, Unaxis expects to supply LCD panel makers with advanced sixth- and seventh-generation (G6 and G7) equipment next year, Kundert said.

That will be just in time for AU, which expects its first G6 factory in Taichung to begin production in the first quarter of next year.

Chi Mei hopes its G7 factory in Tainan will start mass production in the first quarter of 2006. Chi Mei said the plant will cost between NT$100 billion and NT$120 billion.

Commenting on the world's LCD panel industry, Ruurd Boomsma, an executive vice president of Unaxis Balzers AG, said he expected healthy competition between Taiwanese and South Korean companies.

But he said Unaxis did not have any immediate expansion plans for South Korea. Unaxis has two sites in Seoul, but they are smaller than its Taiwanese factory, Boomsma said.

Even though China is seen as a threat in a number of other areas, Boomsma said Chinese companies will not pose a threat to their Taiwanese rivals until after 2010.

"Even though China is evolving into a stronger player, Taiwan will still be an entry to China," he said.