Hon Hai Precision Industry Co (鴻海精密), the world’s top electronics manufacturing services provider, yesterday said it would not sell LCD TVs equipped with screens from Sharp Corp’s 10th-generation factory at a price below cost.
The remark came after speculation in Chinese-language newspapers that Hon Hai planned to sell 60-inch LCD TVs for US$999 each during the year-end shopping season, a move that industry watchers said could prompt price cuts for mainstream 32-inch and 42-inch TVs.
The reports said it was part of a series of measures proposed by Hon Hai to digest excess inventory from Sharp’s factory in Japan’s Sakai, Osaka Prefecture, which is 47 percent owned by Hon Hai Group chairman Terry Gou (郭台銘).
Such a move would trigger a price war in the LCD TV industry, the reports said, citing AU Optronics Corp (友達光電) chairman Lee Kun-yao (李焜耀). Cutting prices to boost sales would be another blow to an industry already plagued by oversupply and falling prices, Lee said.
“We will not sell TVs outfitted with panels made from the world’s only and most advanced G10 factory ... There is no inventory problem,” Hon Hai said in an e-mailed statement. “Hon Hai Group does not make Sharp-brand TVs using flat panels from the Sakai factory.”
Instead, Hon Hai said it has been making efforts to produce products at a lower cost by integrating its resources and improving its operational management.