Hon Hai Precision Industry Co (鴻海精密) and its Japanese subsidiary, Sharp Corp, are considering building an LCD plant in India to meet rising demand for TVs in the nation, the Nikkei Asian Review reported on Saturday.
The possible investment in India would be the latest in a series of projects contemplated by Hon Hai, also known as Foxconn Technology Group (富士康) outside Taiwan, in partnership with Sharp to expand its global flatscreen production, the report said.
A separate report by the paper on Friday said that Hon Hai and Sharp have been studying a plan to set up an LCD plant in the US to tap into demand there for TVs and other electronic devices in response to US president-elect Donald Trump’s “America first” policy.
Late last year, Sakai Display Products Corp (SDP), a joint venture between Hon Hai chairman Terry Gou (郭台銘) and Sharp, announced plans to build a flatpanel factory in China’s Guangdong Province.
Hon Hai completed a US$3.5 billion deal to own a 66 percent stake in Sharp in August last year.
The paper said Hon Hai plans to use the LCD investment in India to explore the growth potential for the Sharp brand, which is not well-known in the nation.
The company also wants to take advantage of Sharp’s flatpanel production technology to create another core business, as the business model built on cheap labor in China has become outdated, the report said.
Hon Hai, a major supplier of Apple Inc’s products, on Tuesday last week reported declining annual sales for the first time since it went public in 1991, with consolidated sales falling 2.81 percent to NT$4.36 trillion (US$138 billion) last year, due to lower-than-expected sales of the latest iPhone models.
HSBC Securities Taiwan Corp forecast Hon Hai’s revenue could increase by 4.9 percent annually this year, with drivers coming mainly from the launch of new iPhone models.
“Hon Hai being the major assembler for new OLED and 5.5 inch iPhones implies less negative impact from the slowdown of 4.7 inch iPhone demand,” HSBC analyst Jenny Lai (賴惠娟) said in a client note on Tuesday last week.
Total iPhone production could reach 220 million units this year, up from 208 million last year, Lai said.
According to the report, Gou told Hon Hai employees that he sees 60-inch TVs becoming the standard in the global TV manufacturing industry and has therefore devised a strategy to build a global flat panel production network to supply big screens to nearby TV assemblers.
Hon Hai has already informed its Japanese suppliers of flat panel components of its plans to set up a plant in the US and another in India, the report said.
Additional reporting by Lauly Li
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