Corning Inc, the world's largest maker of liquid-crystal-display (LCD) glass substrates, said its board had agreed to invest US$453 million to expand its manufacturing capacity in Taiwan as demand for high definition TV sets increases worldwide.
The announcement will help Corning compete with rival Asahi Glass Co of Japan to increase supplies of LCD glass substrates to local customers including AU Optronics Corp (
A statement released by New York-based Corning on Wednesday said the increased capital expenditure would be earmarked for the fourth-phase expansion of its facility in Taichung over the next two years.
Corning was scheduled to hold a conference call with analysts in New York yesterday to provide its market outlook.
"As consumers express their clear preference for LCD televisions, the industry is growing at a rapid rate, and we are continuing to develop the Taichung facility in order to keep pace with projected demand," James Clappin, president of Corning Display Technologies, said in the statement.
Sales of flat-panel displays may rise 12 percent to US$106 billion this year, with TV panels accounting for more than 40 percent of that, DisplaySearch estimated. Shipments of LCD TVs, meanwhile, are expected to reach 165 million units worldwide by 2011 from 80 million units last year, researcher iSuppli has said.
Corning started supplying its Taiwanese customers in 2003 with two factories at the Southern Taiwan Science Park (
Tokyo-based Asahi Glass, the world's second-largest glass substrates maker, also produces locally through its wholly owned subsidiary, Asahi Glass Fine Techno Taiwan Co (
The just-approved spending of US$453 million in Taiwan is part of Corning's US$1.5 billion to US$1.7 billion capital expenditures it announced earlier this year.
The US company said in the statement that it planned to use the new expenditure to produce a range of large-size glass substrates including 8G to meet growing demands from Taiwanese customers.
Mass production is scheduled to begin by the first quarter of next year, it said.
Over the past two years, LCD TV sets measuring at least 40 inches diagonally have been a primary driver of growth for LCD glass demand worldwide, Corning said, adding that the glass demand is expected to continue, partly driven by the emergence of 50 inch and larger LCD TVs.
"The high demand for LCD TV panels has translated to accelerated growth for our customers in Taiwan," Alan Eusden, president of Corning Display Technologies Taiwan, said in the same statement.
"Corning is focused on meeting customer supply agreements to support panel manufacturers' ongoing advancement," he said.
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