AUO granted 7.5 gen plant approval on Chinese soil

AUO has finally been granted formal approval from the Investment Commission of Ministry Of Economic Affairs in Taiwan to a establish a 7.5 Gen fab in China.

Although it is good news for the Taiwanese company to gain approval after a lengthy wait for clearance, it will now be forced to play catch up with LG and Samsung, the Korean firms who have both recently been granted applications to begin production of 8G LCD fabs in China.

A statement from AUO acknowledged this, announcing that “we must work much harder to catch up.”

“In a highly competitive international market, Taiwanese panel suppliers now have only very limited time to create the early-mover competitive advantages in mainland China.”

The Taiwanese firm called for a lenient industry policy from the Chinese government, and asked for a restriction on fab generation and M&A investments in order to help it establish a foothold and boost competitiveness.

AUO’s competitors, LG and Samsung, previously announced that they had been given the go ahead to build 8 gen and 7.5 plants in China respectively, meaning the possibility of production of 50 inch and 40 inch LCD screens.

There has been an increasing focus recently on production in larger fabs, with 41 percent of LCD TV panel in production on 8 gen lines.  AUO also highlighted that its own 8.5 gen fab in Central Taiwan Science Park will enter mass production next year.