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LG Display’s new sixth-generation LCD panel line in Gumi is under construction with operation set for the second quarter of next year.
/ Courtesy of LG Group |
By Kim Yoo-chul
Staff Reporter
LG Group will invest a total of 11.3 trillion won this year for sustainable growth, especially in the display and chemicals segments despite an economic slowdown in developed countries.
"About 5.9 trillion won had been invested in our mainstay businesses as of the end of August. The remaining 5.4 trillion won will go ahead in the coming months in line with this year's capital expenditure plan," a spokesman of the nation's fourth-largest conglomerate said, Sunday.
In the second half, the group's main investment targets will be focused on the display and solar cell-related segments.
The group's display unit, LG Display, plans to spend an additional 1.36 trillion won on building a new liquid crystal display (LCD) production line in the southeastern city of Gumi, where it has also been producing 32 and 37-inch panels for information technology gadgets, as well as television sets.
"Yes, the global LCD panel market has been suffering from prolonged oversupply. But we should make investments in a pre-emptive measure regardless of the situation to maintain our market share in panels when the market enters a tight-supply," Jang Hyo-chul, a senior manager at LG Display's administrative division in Gumi said.
With operation of its sixth-generation line starting in the second quarter of next year, LG Display plans to widen the market gap with its long-time rival Samsung Electronics in the LCD panel market for notebooks.
The line production capacity will be raised to 230,000 sheets per month from the current 170,000 on a substrate glass input basis, according to LG officials. The group's electronics unit, LG Electronics, owns a 36 percent stake in LG Display.
Solar Wafer
LG's virtual solar wafer affiliate Siltron confirmed it will invest 270 billion won for its third factory in Gumi this year to boost its solar wafer production capability in the group's latest pitch for solar business.
"By upgrading facilities, the production capacity of 300 millimeter wafers will be expanded to 350,000 sheets per month from 250,000," Yang Han-young, a CEO of the company said.
In April, LG Group integrated systems among its affiliates for synergy in the solar business.
Under the blueprint, LG Chem is responsible for supplying polysilicon, and LG Electronics is tasked with the development of solar cells ― components used to turn sunlight into electrical power ― while LG CNS is to be charged with a solar energy plant construction project.
But worries were running high that Siltron is hesitating to increase wafer output, leaving doubts over the group's solar project, because semiconductor makers invested excessively and were hit hard financially during the last semiconductor downturn, making them more cautious of expanding capital expenditure.
"Bigger size in wafers means better solar power. But we don't think 450-millimeter wafers will be widely commercialized from 2012," Yang said, adding his staff are conducting internal research for bigger wafers. Currently, 300-mm wafers compose nearly 55 percent of Siltron's total revenue.
Intel and Samsung, two of the world's largest chip producers, are collaborating on new standards that will produce the world’s first 450-millimeter wafers starting in 2012.
Currently, most of the world's top chip companies produce processors on industry-standard 300-millimeter wafers. The possible switch to the larger 450-mm wafers will allow companies such as Intel and Samsung to double the amount of processors they could put on a single wafer.
Analysts say this could help cut the cost of chip production, while reducing the amount of energy, water and other resources used in creating processors.
The semiconductor industry switches wafer products about once every 10 years. The industry first started using 200-mm wafers in 1991 and then changed to 300-mm wafers in 2001. The goal of changing to 450-mm wafers in 2012 adheres to those guidelines.
yckim@koreatimes.co.kr
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