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Samsung Electronics and Japan¡¯s Sony have as good as agreed on joint investment into an eighth-generation liquid crystal display panel production line. The pair will hold a ground-breaking ceremony for the plant at Samsung¡¯s LCD complex in Tangjeong, South Chungcheong Province in the fall.
Samsung Electronics and Sony will conclude negotiations within this month and announce the project after approval from their boards next month, industry sources said Tuesday. They plan to invest at least W1 trillion (US$1=W958) each and are likely to start mass production around August next year.
The two electronic giants already set up a partnership called S-LCD capitalized at W2.1 trillion in 2004 for a seventh-generation LCD plant. Their eighth-generation plant will increase S-LCD¡¯s capital by more than W2 trillion. Samsung Electronics has completed leveling the ground for the plant on an area the size of 15 football pitches at its Tangjeong complex.
The decision is in the two electronics giants¡¯ mutual interest, industry observers say. Sony aims to recover its status as a premium home appliances brand by focusing on the LCD TV market and needs a stable supply of panels. But panels made at the S-LCD plant now fall short of its needs, so Sony has been looking to buy 30-inch panels from Taiwan¡¯s AU Optronics. The firm told an investor relations meeting in Tokyo early this month that its eighth-generation LCD plant would go into operation around the middle of next year.
From the perspective of Samsung Electronics, the joint project is part of an aggressive investment strategy to move ahead of other late movers as the global LCD market is seeing shrinking demand, prompting the world¡¯s no. 2 LG Philips LCD to cut production. ¡°Nothing¡¯s for sure regarding the eighth-generation LCD plant, but it¡¯s true that we are in the last phase of negotiations with Sony,¡± a Samsung Electronics staffer said.
The generation of LCD panels is determined by the size of the motherglass from which panels are cut -- the bigger the motherglass the more advanced the generation. Samsung Electronics is capable of making eight 40-inch panels from a seventh-generation motherglass measuring 1,870 x 2,200 mm and recently determined the size of the eight-generation motherglass at 2,200 x 2,500 mm. .
(englishnews@chosun.com )
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