Seoul: LG Display, the world’s second largest maker of liquid crystal display (LCD) screens, said on 27 July that it would cut its panel output by around 10% until August because of weakening global demand.
South Korea-based LG Display joins Taiwan rivals AU Optronics Corp and Chi Mei Optoelectronics Corp in the move to reduce production and ease an oversupply as market conditions deteriorate faster than expected.
“The output reduction will be around 10% level,” an LG Display spokesman said. “The utilisation rate should rise again from September.”
The company did not give the estimated financial impact of the reduction.
Leading LCD makers have reaped strong profits in the first half but face a steep slowdown in the coming quarters as the global downturn hits demand for flat-screen TVs and personal computers.
Consumers buy smaller television sets while flat TV makers such as Sony Corp and Samsung Electronics Co Ltd are in a fierce price war.
AU, the third-ranked LCD maker, said last week it was scaling back production and its capacity utilisation rate would fall to around 90% in the current quarter. Chi Mei has also undertaken similar steps.
Kwon Young-soo, LG Display’s chief executive officer, said earlier in July that his company might cut output if the market worsened significantly.
But largest LCD manufacturer Samsung on 25 July ruled out a production cut, saying it had enough panel orders. Samsung and its LCD production partner Sony are top TV makers themselves, which give the LCD business a stronger client base.