Local flat-panel maker Chunghwa Picture Tubes Ltd (中華映管) yesterday said it would form a US$3 million venture in China with the world’s No. 2 laptop computer maker, Compal Electronics Co (仁寶電腦), to produce touch panel glasses.
The deal will deepen the companies’ cooperation in the booming touch panel business, which has surged because of increasing demand for tablet devices. It follows Compal’s purchase of a 4.5-generation color filter plant, to be converted into a facility for producing touch panel solutions (eg, touch sensors), from Chunghwa Picture for NT$1.4 billion (US$47.6 million) in December via a subsidiary.
DisplaySearch, a market research firm, estimated in December that global shipments of touch panels last year grew more than 30 percent from a year earlier to 20 million units as the adoption of touch panels extended to tablet devices from smartphones.
Taiwanese manufacturers seized almost 44 percent of global touch panel market share, DisplaySearch estimated.
Taoyuan-based Chunghwa Picture said the new investment was part of its plans to build a supply chain for touch panel production in China and was aimed at boosting revenue and profitability.
“The joint venture will help strengthen the company’s cost competitiveness, speed up our reaction to market changes and streamline the manufacturing flow,” company spokesman Wilbur Chien (簡永忠) said in a statement to the Taiwan Stock Exchange yesterday.
Last week, Chunghwa Picture reported that losses expanded to NT$5.86 billion in the final quarter of last year, from losses of NT$4.98 billion in the third quarter.
In a separate filing, Compal said it would invest NT$16.82 million in HengHao Holding B Co Ltd (華樂光電, 福州) in Fujian Province, China, the Chinese joint venture with Chunghwa Picture, via a subsidiary to make and sell LCD glass.
The announcements came after a report by the Chinese-language newspaper the Economic Daily News yesterday that Compal planned to further invest in touch panel manufacturing to cope with growing demand for tablet devices, citing company spokesman Gary Lu (呂清雄).
Touch panels are a key component in producing tablets, Lu said.
Compal and Chunghwa Picture fell 0.54 percent and 1.48 percent to NT$36.80 and NT$3.99 respectively yesterday.