Merck KGaA, the world's biggest supplier of liquid crystals used in computer and television flat-panel displays, yesterday said it will start supplying the material from a new Taiwanese plant in the first quarter of next year.
The NT$900 million (US$26.82 million) factory is Merck KGaA's first liquid-crystal factory in Taiwan and its third in Asia. The German company also has factories in Japan and South Korea, which are home to top liquid-crystal-display (LCD) panel manufacturers such as Sharp Corp, Samsung Electronics Co and LG.Philips LCD Co.
The Darmstadt, Germany-based firm aims to fully supply local liquid-crystal-display (LCD) panel makers with material from the new factory by the end of next year after launching sales in the first quarter.
Merck KGaA has been supplying Taiwanese customers with liquid crystals mainly from its Japanese factory.
"With the local plant, we believe we'll help our customers get to the market first," Klaus Bischoff, country manager of Merck Group in Taiwan, told a press briefing in Taipei yesterday.
Taiwan's largest LCD panel manufacturers AU Optronics Corp (
Merck KGaA's Taoyuan plant, which is expected to create 120 jobs, comes online amid an upturn in the cyclical LCD industry after almost a one-year slump.
With demand recovering for the sleek LCD screens, local companies said tight supply of certain key components such as CCFLs (cold-cathode fluorescent lamps) would limit production.
Merck KGaA said it has been working closely with its customers on liquid-crystal supply and did not expect any supply constraint.
"From my point of view, that will be not a problem [for Merck]," said Alasdair Jelfs, a managing director of Merck Display Technologies Inc, the crystal display manufacturing unit of Merck KGaA.
A 32-inch LCD panel used in TVs requires roughly 2g of liquid crystals, Jelfs said.
Taiwan overtook South Korea as the world's largest LCD maker in the third quarter, according to market researcher DisplaySearch. Local manufacturers are expected to take the lead next year, another market researcher iSuppli Corp said in May.
Merck KGaA holds a 70 percent share of the world's liquid-crystal market and has the same market position in Taiwan.
Sales to local companies soared to NT$8.2 billion in the first three quarters of this year, compared with NT$500 million in 1990, according to Merck KGaA.
Taiwanese LCD panel suppliers also buy the material from Japan's Chisso Corp, Dainippon Inc and Chemicals Inc.
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