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(Japanese Site)

  • Taiwan LCD Makers Set Conservative Production Goals
  • May 14, 1998 (TAIPEI) -- Liquid-crystal display (LCD) manufacturers in Taiwan are more cautiously controlling production volumes for fear that LCD prices will slide further.
    The fact that rivals in Japan and Korea have scaled down output also prompted local companies to take a wait-and-see attitude.

    LCD makers in Japan and Korea expanded operations in 1996, as they were optimistic about prospects of the notebook computer market.

    However, demand for notebook computers did not soar in 1997 as expected, and an oversupply was seen in the TFT-LCD industry.

    This oversupply sent LCD prices into a tailspin, with 15-in. models suffering the deepest declines.

    In the first quarter of 1997, 15-in. TFT-LCDs were still priced at around US$1,400 a unit.

    By the fourth quarter, the price had tumbled to US$800, which was very close to that of 14.1-in. models.

    The trend also battered the leading role of the 15-in. LCD monitor in the market, bringing its share down to between 30 percent and 40 percent.

    Another factor that makes Taiwan LCD makers hesitate is that rivals in Japan and Korea have decreased their investment and output after 1997's regional financial crisis.

    Heavyweights such as Fujitsu Ltd. and Hyundai Group have decided not to buy any new equipment this year.

    According to a report from Japan's Nomura Research Institute, Korea's investment in the LCD industry will fall sharply from 1997's US$2.21 billion to US$100 million in 1998.

    Local LCD makers point out that shrinking investment by Japanese and Korean rivals may result in a shortage in the global LCD market next year.

    However, local companies are still cautious about raising output, because they will suffer great pressure from existing LCD stock if product prices slide further.

    In addition, since most LCD makers here rely heavily on original equipment manufacturing contracts, local companies are now limiting output before foreign buyers place larger orders.

    (Commercial Times, Taiwan)

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    Updated: Wed May 13 19:48:33 1998