Alexa
  • Directory of Taiwan

Sony, Sharp team up to conquer LCD sector

Agreement a big step toward goal of becoming world's No.1 TV manufacturer, official reveals

Sony, Sharp team up to conquer LCD sector

Japanese high-tech giants Sony and Sharp announced a tie-up yesterday in liquid crystal display panels in the latest industry alliance triggered by fierce competition in the flat television market.
Demand is booming in the flat TV market but intense price competition is forcing companies to seek ways to drive down costs.
Sony Corp. will take a 34 percent stake in a huge LCD factory that Sharp is building in Sakai, western Japan, at a cost of 380 billion yen (US$3.4 billion), a joint statement said. Sharp will own the other 66 percent.
"This agreement is a very big step toward our goal to become the world's number one television manufacturer," Sony president Ryoji Chubachi told a joint press conference with Sharp executives.
Former rivals
Despite being rivals in electronics markets, Japan's high-tech titans are increasingly joining forces in production to weather competition both domestically and from rival firms in countries such as South Korea and Taiwan.
"This cooperation will reduce costs. We will be competitive against other big manufacturers in the world," Sharp president Mikio Katayama told reporters.
The tie-up seemed to be a "win-win deal" for Sharp and Sony, said Osamu Hirose, an analyst at Tokai Tokyo Securities.
"Sharp really needed to secure buyers of LCD panels after investing heavily in the LCD plant, while Sony wanted to have an additional supplier in a bid to boost television sales under its own brand," Hirose said. "As competition is getting more severe in the flat screen market, such strategic tie-ups are expected to emerge in the near future," he said.
No details yet
Financial details were not disclosed but based on the size of its stake Sony is expected to pay more than 100 billion yen for its share in the plant.
The venture will supply LCD panels to the two companies in line with their ownership ratios.
Sharp says the plant will be the first in the world to use 10th-generation glass substrates, which at 2.85 by 3.05 meters are the world's biggest and 60 percent larger than those used at its existing Kameyama plant.
Some 72,000 substrates, which can be cut into several panels, will eventually be fed into the plant each month.
The two companies will also consider developing components for LCD modules, they said.
Sony said it would also continue to buy LCD panels from Samsung Electronics Co. of South Korea.
Investors largely welcomed the news, with Sony shares rising 60 yen or 1.17 percent to close at 5,200. Sharp ended flat at 2,100 yen, outperforming the benchmark Nikkei-225 index, which declined 0.60 percent.
Japan's electronics industry is undergoing a major realignment as companies restructure in response to growing competition.


Updated : 2021-06-19 16:53 GMT+08:00