InnoLux Display Postpones Production at Sixth-Generation Plant

Due to the sluggish demand for monitors, InnoLux Display Corp, the flat-panel unit of the Hon Hai Group, has reportedly postponed mass production at its sixth-generation plant to the third quarter of 2009, one quarter behind schedule, with such rescheduling to, the company estimated, postpone full- capacity utilization until the first quarter of 2010.

The company`s prospective sixth-generation plant will focus on contract manufacture of wide-screen monitors and LCD (liquid crystal display) TVs. Impacted by the flagging economy globally, the company will cut production capacity at the new plant initially until the global economy recovers.

With the procurement cost for flat panels being lower than that of in-house made ones, InnoLux has cut the production at its fifth-generation plant and increased outsourcing. An institutional investor estimated InnoLux will see an operating loss of NT$1.5 billion in the fourth quarter of 2008 due to rising loss in producing monitor panels.

Despite the poor performance in monitor-related business, InnoLux believes its shipments of medium- and small-sized panels and NB panels will grow satisfactorily in 2009.

InnoLux predicted its cellphone panels will see substantial sales growth in 2009 for bringing onboard the world`s top-five cellphones brands as clients.

Source: CENS