Display panel investments surge

With demand for plasma display panels expected to surge worldwide, Korean and Japanese firms are racing to increase their production capacity for the panels, which are used for the screens of large, flat, wall-mounted television sets. LG Electronics yesterday launched its second tranche of production lines for the panels in Gumi, North Gyeongsang province; the new facilities can churn out 35,000 units per month. With the opening of the second-generation lines, LG has increased its production capacity from fifth-largest in the industry to global leader. Including its earlier production lines, LG can now produce 65,000 units the panels per month. “Since late last year, demand for plasma display panel has grown explosively,” an LG official said. “We have not been able to meet about 20 percent of the monthly demand.” Samsung SDI also plans to complete its second-generation production lines for the same panels by November, when the company would be able to produce about 105,000 units a month in total to overtake LG as the largest plasma display panel maker in the world. Japanese firms, who dominated the world plasma display panel market as recently as two years ago, are gearing up to meet the new competition. Fujitsu Hitachi Plasma Display Ltd. plans to invest about 290 billion won ($250 million) over the next three years to expand its production capacity to 100,000 panels per month. Matsushita plans to increase its production capacity to 100,000 panels per month before the end of next year. According to Morgan Stanley, the worldwide demand for plasma display panel will surge from this year’s 1.7 million units to 3.5 million units in 2004, and double again to 7.2 million units in 2005. by Kim Chang-gyu