According to the memorandum of understanding signed between LG and the Guangzhou government, the South Korea-based company will invest five trillion won (US$ 4 billion) to build an 8th-generation LCD panel plant in the city, reports
Shanghai Daily.
LG said such plant allows a more efficient production of larger-sized LCD panels, such as 50-inch, for televisions.
So far, the most advanced LCD panel plants in China is the 5th-generation, though Beijing-based BOE Display now is building a 6th-generation plant in Hefei city, the capital of Anhui province. All these plants are only for computer monitors.
Rumors say LG's Japanese counterpart, Tokyo-based Sharp is also planning to set up an 8th-generation product line in China.
Moving the core technology of producing the LCD TV panels to developing countries like China has long been a taboo for big companies overseas, especially in Japan, South Korea and Taiwan area.
But the recent rise of Korean won, the increasing foreign investors - friendly preferential policies offered by the Chinese government and the growing logistic costs for larger panels are all the key factors that pushed the Korean companies to change their minds, Yu Weilong, a Shanghai-based analyst at the Korean research firm Displaybank told China's
local media.
In fact, there are also signs showing that the Taiwan authorities have eased the relevant restrictions since Ma Ying-jeou took office in 2008.
"Korean and Japanese companies apparently want to speed up the layout in China before their Taiwan competitors take action," Yu said.
