LG Display opens LCD panel factory in ChinaThe world’s top LCD panel maker LG Display will start producing LCD panels in China, the largest TV market in the world, after opening a new plant in Guangzhou yesterday.
LG Display China, a corporation in which LG Display has invested 70 percent, Guangzhou Development Group 20 percent and Chinese TV maker Skyworth 10 percent, will produce the 8.5-generation LCD panels that are also sold in Korea.
The investment is worth $4 billion, or about 4 trillion won.
It is the first time LG Display will produce LCD panels overseas, while Samsung Electronics has been operating an LCD plant in Suzhou since the beginning of the year.
LG Display has previously only made the panels in Korea because the production requires special technology. LG manufactures TV parts to be installed in the back of its panels at its overseas plants in China, Poland and Mexico.
However, as demand surged for TVs in China and the Chinese government increased tariffs on imported panels from 3 percent to 5 percent, LG Display decided to produce LCD TVs in China.
“The Chinese production plant will cut costs and increase LG Display’s market share in the world’s largest TV market,” said Han Sang-beom, CEO of LG Display.
In addition to saving on taxes, making the displays will be cheaper due to lower labor and distribution costs within China.
The factory was built in two years and four months and will mainly produce LCD panels for 55-inch, 49-inch and 42-inch ultra high-definition and full HD TVs.
The company aims to produce 120,000 panels by the end of 2016, starting with 60,000 panels a month.
At the opening ceremony yesterday, Koo Bon-moo, chairman of LG Group, discussed further cooperation with Hu Chunhua, the Communist Party’s secretary of Guangdong province. It is the first time in five years Koo has visited the site of an LG business in China.
During the opening ceremony, the factory also received a “green plant” certificate - the first to be handed out in China. The certificate is given to facilities that fulfill the government’s regulations in 32 categories related to the environment.
BY KIM JUNG-YOON, KIM Eun-Ji[firstname.lastname@example.org]