AUO to delay LCD expansion due to Q1 loss

Taiwan-based AU Optronics Corp. will delay expansion of its factories by almost a year after a global surplus led to a record loss in Q1, according to a Bloomberg report.

AUO chairman K.Y. Lee said that the company will put off installing equipments in its new plant line until the end of 2008. The second manufacturing line had originally been scheduled to start at the start of 2008.

Meanwhile, AUO's biggest rival in Taiwan, Chi Mei Optoelectronics Corp. (CMO) also slowed expansion after reporting a loss in Q1. CMO chairman Frank Liao disclosed that the company has not placed equipment orders for its newest LCD plant.

According to Witsview Technology Corp., global LCD supply will rise 35 percent in 2007, compared with a 40 percent growth in demand. In addition, prices of TV panels measuring 42 inches diagonally may drop 1.8 percent this quarter, from a 9.5 percent decline in Q1.

Research firm DisplaySearch said that declining prices will help LCD shipments to outpace other types of TVs. It also estimated in January that LCD TV sales may shoot 56 percent to 69.7 million units this year, while plasma TV shipments may jump 33 percent to 12.9 million units.