By Kim Yoo-chul
Staff Reporter
GUMI, North Gyeongsang Province ― LG Display, the world's second-largest producer of liquid crystal displays (LCD) panels, confirmed Wednesday an earlier Korea Times report that it is talking with Japan's Sony about supplying panels.
"LG Display has offered the Tokyo-based company supplies of 37-, 42- and 47-inch LCD panels," CEO Kwon Young-soo told reporters. These sizes are not supplied by S-LCD, the Samsung-Sony joint venture.
"We are waiting for a response from Sony, but there's no reason for Sony to refuse such a deal," Kwon added.
Kwon was speaking on the sidelines of the opening of LG's second sixth-generation LCD facility in Gumi, some 250 kilometers south of Seoul.
On the question of a possible oversupply in the global LCD industry in the second half of the year, Kwon said his company is seeing "little oversupply signs," because it would be difficult for struggling Taiwanese panel makers to boost their factory utilization rates to 100 percent.
Kwon's remarks came amid worries over the partnership between Samsung Electronics and Sony.
Since April 2005, Sony has been buying half of LCD panels used in pricey flat-screen TVs from S-LCD in Tangjeong, South Chungcheong Province.
Sony ― once the TV titan but now grappling with falling profits ― has recently vowed to change strategy in receiving TV panels from S-LCD, citing profitability.
Additionally, Samsung recently refused to supply advanced white LED cells to Sony ― a move that market watchers said is aimed at seizing the largest share in the promising global LED TV market.
For panel makers such as LG Display, securing as many stable clients as possible is the key to gauging profitability.
LG's key clients are Apple and Dell of the United States. It also sells the key components for TVs to LG Electronics and some leading Chinese TV makers.
At the opening event, Kwon pledged steady investment in flat-screens in Gumi.
"LG Display has invested more than 1.3 trillion won, or $980 million, to expand our second sixth-generation LCD line here. We expect to create an additional 1,500 jobs by running the latest facility," the top company executive said.
"We will expand the monthly production capacity at the plant by 60,000 panels by the end of the year from the monthly capacity of 15,000 panels as of April," he said.
The new panel line is optimized to produce the key components for notebooks and monitors.
"Recovering demand is driving up panel prices. The rising utilization rate reflects a gradual recovery in end demand rather than a situation driven simply by inventory build-up," Kwon added.