Mon, May 02, 2005 - Page 10 News List

Taiwan could beat South Korea in LCDs in 2006

MORE CAPACITY The research house iSuppli said in a report that the nation's TFT-LCD makers could take the top spot from South Korea next year if trends continue


Taiwan is expected to take the top position in the world's thin-film-transistor (TFT)-liquid-crystal-display (LCD) market next year, beating arch rival South Korea, due to faster capacity expansion, market researcher iSuppli Corp said in a report released on Thursday.

Taiwanese makers of TFT-LCD panels for computers and TVs led by AU Optronics Corp (友達光電) briefly outstripped their South Korean competitors in the second quarter of last year in a close race to take dominance of the industry by shipping more products, iSuppli said.

By the end of next year, 24 TFT-LCD fabs will be operational in Taiwan and 19 in Korea, the El Segundo, California-based research house added.

Last week, both AU Optronics and Chi Mei Optoelectronics Corp (奇美電子) announced they would resume construction of advanced 7.5-generation plants in Taiwan later this year, to pave the way for an industry upswing.

Last year Korean companies took a bigger share, 46 percent, of LCD panel shipment globally, compared to Taiwan's 44 percent. Japanese makers accounted for 10 percent, while Chinese TFT-LCD display latecomers SVA-NEC LCD Co (上海廣電) and Beijing Orient Electronics Technology Group (京東方) only grabbed 0.12 percent.

"Taiwanese manufacturers' prodigious capital spending is putting them in position to challenge the South Korean's established leadership in TFT-LCD panel production," iSuppli President Derek Lidow said in the report.

This year, AU Optronics has planned to earmark some NT$80 billion (US$2.56 billion) for capital spending while Chi Mei is considering pouring in about NT$70 billion into more production capacity, according to figures provided by companies.

In January, Samsung Electronics Co, the world's largest LCD maker, said it planned to double its capital expenditure on LCD investments to 2.9 trillion won (US$2.91 billion) this year, while LG.Philips LCD Co, the second-biggest, may boost its capital expenditure to 4.8 trillion won this year from 3.9 trillion won last year.

"iSuppli predicts that the competition will remain extremely close in 2005, with Korean companies holding onto the lead," the research house said in the report.

But Taiwan's sustained advantage in production will allow it to take the lead in TFT-LCD shipments from South Korea next year, if capacity is added as planned, iSuppli said.

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