Joint venture for panel-making plant

Move raises fears about overcapacity

TCL Corp, China’s largest television maker, fired the opening shot yesterday in what could become a rush by Chinese companies into liquid crystal display (LCD) panel manufacturing.

TCL, one of the country’s electronics groups, said it had set up a joint venture with Shenchao Investment, a company owned by the Shenzhen city government, for building a new plant.

The move follows announcements by Smasung, LG and Sharp, three of the world’s leading LCD panel makers, that they would build fabrication plants, or fabs, in China to capitalise on the country’s booming flat-screen television market.

However TCL’s move has intensified fears of a new overcapacity in a notoriously cyclical market.

TCL said it would raise up to Rmb5bn ($732m) in a private placement to finance the venture. Construction will start in January, and the plant is expected to take up mass production in the third quarter of 2011.

Financial Times 18 November 2009

This entry was posted on Monday, December 28th, 2009 at 5:27 pm and is filed under Chinese Domestic News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.