Wed, Aug 02, 2006 - Page 11 News List

Sharp to open new LCD plant ahead of schedule

PANEL MARKET The company, which wants to speed up the start of a new plant to meet demand for larger TVs, will commence production next month at the new facility

AP , TOKYO

Sharp will start up its liquid-crystal-display (LCD) plant this month, two months ahead of schedule to meet surging demand in bigger but slimmer TVs and stay ahead of rivals for year-end shopping, the Japanese electronics maker said yesterday.

The ¥150 billion (US$1.3 billion) plant in Kameyama, Mie Prefecture, central Japan, which will make top-notch panels for flat-panel TVs using "eighth-generation" technology, was initially set to open shop in October.

But Sharp Corp said in a statement it will begin operations this month with production of the LCD TVs set to start next month for global markets.

Sharp has scored success with LCD TVs, even as other Japanese electronics makers have struggled to keep abreast of cheaper Asian competition.

The Osaka-based maker of Aquos brand TVs got a head-start by focusing on flat-panel TVs and has the advantage of making both panels and TVs in-house, instead of having to buy panels from other companies.

But Sharp is eager to stay ahead of the competition, including Samsung Electronics Co of South Korea and Japanese rival Sony Corp, which makes LCD panels in a joint venture with Samsung.

Although Sony fell behind Sharp in LCD TVs at first, it has made a strong comeback over the past year, riding on the prestige of the Sony brand, especially in the US.

While worries are growing about a possible glut in LCD panels, higher-end makers like Sharp are facing the opposite problem: a panel shortage.

Sharp commands about 13 percent of the global market in LCD TVs, according to DisplaySearch, which compiles such data, but it's going neck-and-neck against three powerful rivals, Sony, Samsung and Royal Philips Electronics NV.

Sharp already makes smaller glass panels at a nearby plant, producing 60,000 panels a month there, for TVs that are about 30 inches in size.

But Sharp has been trying to speed up the start of the new plant to meet growing demand for larger 40-inch and 50-inch TVs, company spokeswoman Miyuki Nakayama said.

The new plant will produce 15,000 panels a month, enough for 120,000 40-inch TVs. Production will be boosted to 30,000 panels a month by March next year, Sharp said.

Sharp expects to sell 6 million LCD TVs worldwide during the fiscal year ending March next year, up from 4 million in the fiscal year through March.

Last week, Sharp reported a 23 percent jump in profit for the first fiscal quarter at ¥23.9 billion on growing sales in flat panel TVs and mobile phones. Quarterly sales totaled ¥693.7 billion, up 12.6 percent from the same period a year earlier.

Sharp shares, which rose to about ¥2,200 earlier this year, have settled lower lately and inched down 0.1 percent to close in Tokyo at ¥1,935.

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