AU Optronics wants to build LCDs in China

Big Taiwanese LCD manufacturer AU Optronics (AUO) said it wants to start a subsidiary company in mainland China.

The reason it wants to build a fab on the mainland is because China is now one of the premier markets for LCD TVs.

But first it has to seek permission from the Taiwanese government, which is chary about seeings its home grown manufacturing escape to the mainland.

AUO said it has applied to the Investment Commission of the Ministry of Economic Affairs to build a fab in Kunshan, Jiangsu.

The $3 billion fab will build a G7.5 kitted factory. LCD manufacturers call their fabs generation seven, eight and so on. The firm said it will carry on investing in creating manufacturing in Taiwan itself, and will install equipment for a G8.5 fab in the Taichung Science Park by the end of this year.

The company makes TFT-LCD screens sanging from 1.2-inches to over 65-inches, and had revenues of $11.2 billion in financial year 2009.

Meanwhile, Chi Mei Innolux Optoelectronics will open for business on the 18th of March – it’s formed from the merger of Innolux, Chi Mei Optoelectronics and TPO Displays. The combine will become the third biggest flat panel manufacturer in the world.