Fri, Dec 08, 2006 - Page 11 News List

AUO cutting utilization rate as customers adjust inventories

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AU Optronics Corp (友達光電), the nation's largest maker of liquid-crystal displays, said it would cut production in the current quarter and reduce its growth estimate for the period because clients were curtailing purchases.

"The company experienced an early sign of [some customers] controlling year-end inventory," the Hsinchu-based company said in a statement. It will cut average capacity utilization to about 90 percent in the current quarter from 95 percent in the third quarter, AU Optronics spokeswoman Hsiao Ya-wen (蕭雅文) said in a telephone interview.

AU Optronics and rivals such as Chi Mei Optoelectronics Corp (奇美電子) are facing slower sales growth because customers are reducing inventories. AU Optronics had said in October it expected capacity utilization to remain unchanged this quarter.

Shipments of panels measuring 10 inches and larger will rise 30 percent to 35 percent in the quarter, less than an earlier estimate of 40 percent, the company said in the statement. AU Optronics shipped 12.6 million large panels in the third quarter, according to a company presentation.

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