Yesterday Forbes reported Taiwan LCD screen makers are getting ready to start investing in China. Forbes says:
Taiwan's plan to allow its liquid crystal display makers to set up panel factories in China looks set to trigger a wave of new investments on the mainland, breathing new life into its infant LCD industry.
Big Taiwanese display makers, including AU and Chi Mei, could follow in the footsteps of local chip rivals to gain a stronger foothold in China, a major consumer of chips and panels used in everything from cellphones to computers and flat-screen TVs.
Forbes provides some background:
For now, under Taiwan's rules, LCD makers can only do final assembly work in China using panels produced elsewhere.
But Taiwan's government is reportedly mulling lifting a ban on producing LCD panels in China, high-tech work that typically requires $1 billion or more to build a single factory.
That could shorten delivery time, reducing costs and potentially bringing a cluster of display and component makers to create a huge LCD manufacturing centre in China.
The Commercial Times, one of Taiwan's top business newspapers, reported last month that Taiwan's economics ministry would lift a rule that prohibits local display makers from making seven-inch panels in China as a first step, and then allow them to open 5.5-generation manufacturing factories there.
Generally speaking, the higher the generation, the larger the size of the screen produced. A new generation is also usually based on a significant technological development from the previous one.
Display makers will be allowed to open 6th-generation factories in China within four years, but only after Taiwan plants using advanced 8th-generation or higher technology have entered steady mass production for six months, the paper said.
An official at the ministry declined to confirm the report but said the ministry would examine the current rules in August.
Forbes later notes how China have struggled to develop the LCD industry themselves. The three big LCD players in China BOE Technology, SVA NEC and InfoVision Optoelectronics are all suffering from rising costs and really struggling with competition. According to an iSuppli analyst quoted on Forbes: "Investment from Taiwan's LCD makers would breathe new life into China's LCD industry technology."
Once again this is a win for China. Will this be good for Taiwan? First, as Forbes notes toward the end of the article, it is not certain Taiwan's panel manufacturers will choose China as their manufacturing base. Increased labor costs are forcing many Taiwanese manufacturers to rethink their China investment strategy and some may consider moving to Vietnam (see China + 1 Strategy).
Will it be good for Taiwan? Only time will tell. It seems Taiwan's government will at least try to keep some more advanced factories and technologies here in Taiwan. That should be good for Taiwan's economy! Right now to me it just seems since President Ma's inaugration a lot of change is happening in the structure of the tech industry in Taiwan. Lets hope they are sensible and keep some of their domain knowledge and technological expertise in Taiwan. Although Taiwan is certainly moving towards a knowledge based economy, the tech industry is still one of the main arteries of prosperity here. Hopefully it will continue to thrive and grow. Lets hope so!
Forbes: China LCD makers set for boost from Taiwan investment
No comments:
Post a Comment