Foxconn and Sharp ally to counter Korean flat panel hegemony

A report from Japanese wire Nikkei said that flat panel giant Sharp and ODM giant Foxconn have formed a joint venture partly aimed at keeping Korean manufacturers of  LCD glass out in the cold.

Foxconn owns Chimei Innolux, a manufacturer of LCD panels and under the terms of the JV, it and Sharp will each hold 50 percent of the company.

The aim is to drive down costs and to this end the JV will mean cheaper glass substrates and other components. Sharp will provide big panels while Chimei will supply smaller panels.

Samsung and LG – both South Korean companies – are major competitors to Sharp and to other Taiwanese LCD TFT manufacturers. There’s still a lot of growth in the market, particularly so in China and in India.

Being able to secure substrates more economically will give the Sharp-Foxconn JV an extra couple of points on their margins.