In response to the growing demand for flat-screen televisions, two giant electronics corporations, Samsung and Sony, have signed an agreement to build one of the most advanced liquid crystal display (LCD) manufacturing plants in the world.
Earlier this April, the two companies also signed an agreement regarding their plans for the aforementioned manufacturing project. This factory will produce eighth-generation TFT LCDs (8G) and will be operated by S-LCD, a joint venture between Samsung and Sony.
These corporations plan to invest approximately $1.9 billion (with each contributing 50%) to manufacture the 8G LCD line, which will produce screens measuring about 2200x2500mm. This LCD technology can yield eight 46-inch television screens or six 50-inch television screens. The investment amount does not include the cost of real estate. Currently, S-LCD has been producing the 7G line in Tangjeong, Chungcheongnam-do, South Korea.
According to the plan, the factory is set to commence operations in the fall of 2007, with a monthly production capacity of around 50,000 screens. Samsung and Sony will split this production evenly, using the screens for their own televisions or selling them to other manufacturers.
Along with the current 7G line, the production plan for the 8G line will help both companies expand their production of large-sized LCD screens for 50-inch televisions, which are projected to see significant revenue growth, thereby requiring a stable supply.
Currently, consumer demand for LCD televisions is on the rise. Samsung has raised its global demand forecast for LCD TVs to 48 million units, an increase of over 4 million from previous estimates. In the second quarter, Samsung sold 1.2 million LCD TVs, quadrupling sales compared to the same period last year.
