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Thursday, January 13, 2005
Sharp to invest two bln dlrs to boost LCD panel output

Japanese electronics maker Sharp Corp. said it will invest two billion dollars to increase output of liquid crystal display (LCD) panels for digital TVs, mobile phones and game consoles.

Sharp said Wednesday that it would spend 150 billion yen (1.5 billion dollars) to launch in October 2006 its new Kameyama No. 2 plant in western Japan, which together with the existing No. 1 plant would make LCD panels for flat-screen televisions.

The company plans to double output capacity at the new plant at its Kameyama complex from an initial 15,000 LCD panels a month to 30,000 in 2007.

Sharp also plans to increase capacity at the existing Kameyama No. 1 plant to 45,000 panels a month by April 2005, from the current 27,000 panels.

"Demand for digital broadcast-ready LCD TV sets will expand rapidly both in and outside Japan," Sharp said in a statement.

For terrestrial digital high-definition television broadcasts, LCD panels are better than plasma display panels, although the latter is a more dominant format, Sharp president Katsuhiko Machida told a news conference.

"As competition with PDP (plasma display panel) makers is becoming tougher, we will work more closely with suppliers in developing new parts while aiming to halve the turnaround time (to seven days) to maintain cost competitiveness," he said.

"Our business climate will become more severe this year, owing to South Korean, Taiwanese and Chinese makers catching up, which will increase downward pressure on product prices," he added.

Sharp aims to boost sales of LCD televisions to 4.5 million in the fiscal year to March 2006, and to 7.0 million for the following year, from an estimated 2.7 million in the year to March 2005.

The company also plans to spend 53 billion yen on adding a third line to the Mie No. 3 Plant, south of its Kameyama complex, with a monthly capacity of 6.8 million system LCDs used in game consoles and mobile phone handsets.

When the No. 3 plant starts operations in April 2005, Sharp will have a combined production capacity of 19 million system LCD panels a month.

Sharp aims to increase LCD business revenue to 830 billion yen in the year to March 2006, from 730 billion yen projected for the year to March 2005.

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