LGD 1.3 billion US dollars to increase production capacity optimistic about LCD TVs this year
According to Reuters, South Korean LCD display giant LG Display plans to spend US $ 1.3 billion to provide capacity to meet the rapid growth of consumer demand. At the same time, the company believes that LCD TV sales will grow steadily in 2010.
Thanks to the arrival of the Asian Lunar New Year sales season and the upcoming World Cup in South Africa in 2010, the global LCD TV industry has seen a significant increase in demand recently. At the same time, however, analysts are still concerned that manufacturers' sharp increase in production capacity will lead to oversupply in the market.
Kwon Young-soo, CEO of LG Display, said after the company ’s annual shareholder meeting: "We are not worried that the market will be oversupplied in the second half of 2010. Because despite the increased capacity of manufacturers, However, the current supply of high-end products and large-size products can only barely meet the needs of consumers, so the entire market will continue to maintain a good momentum of development. "
LG Display said that the company will invest 1.5 trillion won (US $ 1.3 billion) to build a new production line from the first half of 2011, and will mainly produce large-size LCD TV panels. At present, LG Display is the world's second largest LCD display manufacturer.
In addition to the production lines mentioned above, LG Display currently has another production line that will be officially put into production in the first half of this year. In addition, LG Display's proposal to spend US $ 4 billion to establish a factory in China is awaiting approval from relevant authorities. According to LG Display's forecast, after these three projects are fully operational, the company's monthly production capacity will increase by about 30% by 2012.
Im Sung-bum, an analyst at Hanwha SecuriTIes, said: “As far as the current situation is concerned, market demand has maintained good growth, but LG ’s substantial increase in investment is likely to lead to competitors’ follow-up, and demand in the future remains uncertain. Under the circumstances, the global LCD TV market is likely to be oversupplied. "
In Friday ’s Korean market transactions, LG Display ’s stock price rose 2.3% to 36,000 won per share. In the 2009 transaction, the company's stock price rose 40%.
According to a report released by the research organization iSuppli, due to the transformation of products to large size and high technology, the global LCD TV display market sales in 2010 will rise by 40% to reach 49 billion US dollars.
Quan Yingxiu said: "Market demand is very strong. At present, we can only meet 80% of consumer demand, so we will seriously consider plans to increase production capacity. Although seasonal demand may be reduced, it is difficult to reduce the price of the display. The prices of some of the TV and IT displays are likely to rise due to insufficient supply. "
Quan Yingxiu said he expects the Chinese government to approve plans for two foreign-funded enterprises to establish LCD factory in China in March this year. The market generally expects that China will surpass the United States and Europe in 2011 and become the world's largest consumer of LCD TV products. At present, LG's main competitors in the field of LCD TVs are Samsung Electronics and Sharp. These companies are actively expanding their business in China.
It is reported that LG Display's plan to increase production capacity has been approved by the company's shareholders
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