AU Optronics forecasts 100 percent capacity utilisation in Q3

AU Optonics has announced that it thinks it will have 100 percent capacity utilisation by the third quarter of this year, according to Chinese-language Economic Daily News via Taiwan Economic News.

AU Optronics is currently operating at 90 percent capacity utilisation, but its vice-chairman, H.B. Chen, claims that the company can now gain the remaining 10 percent over the next quarter. 

He also forecast that the figures for the second quarter of this year should reveal a 10 percent quarter-on-quarter growth, suggesting that the TFT-LCD display company has been making good progress this year so far.

The reason for the growth is attributed to strong inventory and the active involvement and investment of major brands, putting AU Optronics in a good position in the growing display market.

A price hike is expected in the second half of this year due to growing demand for TFT-LCD panels, despite the fact that the second quarter of this year has seen prices falling. Chen attributed much of the demand to the Chinese, U.S., and Southeast Asian markets. Europe, on the other hand, has presented a much more unstable market due to national debt and a weak Euro.

TechEye spoke to Bob Raike at Meko, a market research consultancy specialising in displays. He told us that 100 percent utilisation is easily feasible for AU Optronics because the third quarter will be the peak period for making panels that will be used for TVs going on sale in the fourth quarter, which is the peak season for TV sales.

He said that this means AU Optronics is making everything it can, with “no dead time”, and added that the company is around fourth in the league table of LCD makers.

We asked what the effect would be for consumers and he told us that the only effect is that there might be less shortages of products, and prices would tend not to follow long-term decline. He qualified this by saying that pricing is also partially decided by the TV manufacturers themselves.

Raike said that the TV market was “almost impervious” to the recession, while notebooks also did well. Monitors, on the other hand, have been on the decline in recent years.

As for the rumoured price hike, Raike believed that prices could rise “a little” in the fourth quarter of the year, but that would have no impact on European customers, who are still faced with a weak Euro.