Major TFT-LCD Makers Cut Staff For the First Time in Industry's History

To cope with unprecedented business climate ahead, the top-two thin film transistor-liquid crystal display (TFT-LCD) panel manufacturers, AU Optronics Corp (AUO) and Chi Mei Optoelectronics Corp (CMO) in Taiwan, cut their workforce for the first time ever.

Such a move is in stark contrast to the industry`s history over the past 10 years, during which major panel suppliers had been steadily expanding capacities, hence were usually short of workers.

With employee performance ratings having been done, AUO recently announced to cut around 2 percent of about 38,000 global employees.

Industry sources pointed out that staff cutbacks by AUO or CMO had not been reported for the top two players had been aggressively expanding capacity.

The global downturn had clearly impacted the TFT-LCD industry in the second half of 2008 to cause serious excessive panel supply. Almost all panel suppliers` equipment-utilization has dropped to under 50 percent, so it is necessary to reduce staff to save costs.

CMO said that it plans to weed out 3 to 5 percent of its formal employees by the Chinese New Year holidays in late January. The firm is also integrating its business divisions to cut cost and upgrade efficiency as well as avoid redundancy. Industry insiders said that there might be more layoffs after such integration.

Source: CENS