Korea’s LCD success lifts parts makers

With domestic companies rising as major players in semiconductors and liquid crystal displays, parts manufacturers have found success as exporters over the past two years. For example, Jusung Engineering, a maker of liquid crystal display, or LCD, parts, achieved sales of 166.9 billion won ($164 million) last year; 56 percent of that came from exports. It’s a huge jump from when it was first established in 1995, when the company’s exports were next to nothing. Phicom, which makes inspection devices for semiconductors and LCDs, had sales of 17.2 billion won in 2002, of which only 5.5 percent were from exports. Last year, however, their sales increased to 62.8 billion won, with 35 percent of that coming from export sales. These companies say that their competitiveness in the global parts market has increased because of Korea’s growing semiconductor and LCD industry, in particular the major facilities investments made by huge companies like Samsung Electronics and LG Philips LCD. “When we were trying to open up deals in Taiwan, we were rejected every time until we started putting emphasis on how we were supplying our products to Samsung Electronics,” said Park Kyung-soo, president of PSK, a maker of ashing systems, devices that are used to cleanse semiconductor wafers. “It was hard for us to export products since we had no brand power, but now that Korea is a leading country in semiconductors and LCDs, it is easier to get deals,” he said. However, although small parts manufacturers are more competitive than before, they are still behind other major firms, according to the Korea Semiconductor Industry Association. Domestic companies’ sales of semiconductor parts are meager compared to those of firms like the U.S.-based Applied Materials. Also, production of pricey devices that have high added value is dominated by companies such as Japan’s Canon, Nikon, and Dutch-based ASML. by Lee Hyun-sang, Wohn Dong-hee