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LG cuts costs, reduces PDP production

Posted: 22 May 2007 ?? ?Print Version ?Bookmark and Share

Keywords:PDP production? production costs? digital displays?

LG Electronics announced it will shut down one of its three PDP production lines to reduce costs, according to a report from The Korea Herald.

In a company statement, LG said it will stop the production line of A1 within the first half of 2007 and focus production on A2 and A3. The A1 production line has a capacity of producing 70,000 panels a month. Stopping A1 production will reduce the company's overall PDP output from 430,000 to 360,000 units a month.

Currently, A2 and A3 lines produce 120,000 and 240,000 units, respectively, a month. Company officials disclosed that the A1 line shutdown will reduce costs by $21 to $32 million annually.

Vice Chairman Nam Yong also hinted that the company would restructure its PDP business to cope with the operating loss in the digital display business. LG's digital display business recorded an operating loss of $281 million in Q1, from $104 million in the previous quarter, due to PDP price cuts and low efficiency.

On the other hand, Korea's other PDP maker, Samsung SDI, said it does not have plans to cut back on PDP production. Samsung spokesman Seo Hae-soo said the company has finished renovating the oldest line and expects PDP production to increase from 360,000 to 610,000 panels per months when the 4th plant in Busan starts operating.

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