January 3, 2006 – Samsung Electronics and LG.Philips LCD simultaneously started the mass production of larger TV panels at their newest fabrication lines on Sunday, foretelling an uphill battle for the leadership of the liquid-crystal display (LCD) market, reports Cho Jin-seo of the Korea Times.
LG.Philips LCD, a joint venture between LG Electronics and Royal Philips Electronics, announced on Sunday that it opened its seventh-generation LCD factory in Paju, north of Seoul. Samsung, the current market leader, also said that it started mass production at its second seventh-generation LCD line in Tangjong, south of Seoul, named 7-2 Line. Both Samsung and LG Philips factories will churn out 45,000 LCD plates per month.
The opening of the new facilities are a few months ahead of the companies’ original plans, as they are competing to gain control of the industry standard for LCD panel size, the Korea Time said. Samsung cuts one seventh-generation plate into eight 40-inch panels or six 46-inch panels, while LG.Philips makes eight 42-inch or six 47-inch panels.
“The mass production at Line 7-2 is deemed a major watershed for Samsung Electronics, giving the company an advantageous position in standardizing LCD TVs around 40 inches and 46 inches,” Samsung Electronics said in a statement.
For its part LG.Philips said: “LG.Philips will focus on producing panels for 42-inch TVs and will increase the production volume of 47-inch panels in the future in order to strengthen their dominance in the large-size LCD TV market.”
The early opening of the facilities are also aimed to meet the soaring demands of large-size LCD TV sets ahead of several big sports events in 2006, such as the Winter Olympic Games in February and the 2006 World Cup in June. Research firm DisplaySearch forecasts that the global market for large-sized flat-panel TVs will grow to 8.9 million units this year from 5.4 million in 2005.
LG.Philips said it took only one month after the pilot production to start mass production in its Paju factory. The company plans to expand the production capacity from the initial volume of 45,000 sheets per month to 90,000, or 720,000 panels for 42-inch TVs, by the first quarter of 2007.
Samsung said that it invested 2.3 trillion won in its new line and plans to make an additional 1.8 trillion-won investment in the second half of the year for a full-scale production capacity of 90,000 sheets per month.