LG Display has announced that it will expand LCD production capacity by investing KRW 1 trillion to build a new TFT LCD fabrication plant. The new TFT LCD fab will be a G6 and is slated to begin operations in Q2’09, in about a year. The stock market reacted negatively due to an already anxious 2009 when an oversupply is expected. Overall capacity investments by LG Display will hit KRW 3.6 trillion. In 2009, capital spending by LG Display is expected to decline to just KRW 1.8 trillion. Currently, LG Display is reducing LCD TV panel output and instead producing more LCD panels geared for
IT applications such as LCD monitors and notebook PCs. LG Display noted that it is experiencing a weakening demand for LCD TVs. LG Display is expected to weather the oversupply market condition in 2009 by focusing on LCD panels for IT applications and that is the reason why the company is adding a G6 line instead of a larger line. G6 is a versatile size allowing for manufacture of not only LCD TV panels but notebook PC and LCD monitor panels efficiently.
There could be downward pressure on LG Display’s stocks as Philips Electronics is expected to further sell down its stake in the company, starting June 10, when a lock-up period for its last sell down terminates. There are other worries concerning LCD manufacturers: it seems profits have most likely peaked in Q1’08 with 30% of the world’s market for LCD TVs having recessionary difficulties.
Source: Taipei Times
[tags]Display Manufacturer, LG Display, LPL, Philips Electronics, G6[/tags]