Japanese company Sharp and Taiwanese company Hon Hai Precision Industry Co. have announced a new collaboration. The two companies will construct a 61 billion yuan ($8.8 billion) factory that will produce liquid-crystal displays (LCDs). The plant will be located in China and will be opened in 2019.
Hon Hai Precision Industry Co. is also known as Foxconn, one of the leading manufacturers of consumer tech components. The brand stepped in to prop Sharp up in February, investing $6.24 billion for 66% of the company. This acquisition came after the Japanese electronics company had sold it Latin American TV business and saw its US market decline.
The new Sakai Display Products Corp's plant will be fully operational by time it opens. The plant will specifically focus on large-size LCD panels. It will be a Gen-10.5 facility and will have a capacity the equal of 92 billion yuan a year.
Foxconn and Sharp want to ramp up production for what is predicted to be an increase in demand for large screen TVs. The company's particularly predict a surge in new customers in Asia, especially in China.
While Sharp has seen its market position slide in Europe and North America, the company remains a major TV supplier in Asia. Indeed, the company is the biggest-selling TV brand in Japan.
LCD vs. OLED
LCD has already emerged victorious in a screen war with plasma screens, but now the technology faces a new threat. This week, I wrote a report on how Microsoft and Apple are now exploring AMOLED panels for their upcoming mobile devices.
The smartphone market is making a shift towards OLED, especially amongst the major market players. However, in terms of TV technology, LCD remains in the game. Manufacturers expect demand to increase over the next five years.
For example, BOE Technology Group has started its own Gen-10.5 plant. The company is the largest LCD maker in China and its plant will open in Hefei in 2018. TCL Corp is also building a plant in Shenzhen, at a cost of 50 billion yuan. The LCD facility will be made through TCL's Optoelectronics Technology Co. subsidiary.