LG Electronics is creating its smallest plasma display panel for the Chinese TV market, a company spokesman said on Monday, as the loss-making flat screen division struggles to diversify its customer base.
South Korea-based LG, the world’s No. 2 maker of plasma display panels (PDPs), will supply 32-inch plasma panels — the smallest the company has ever produced — for unspecified Chinese TV set makers, the spokesman said.
The move comes as LG has cut output and is reviewing steps to restructure its PDP business amid falling panel prices and growing losses.
“We will begin the mass production from June, at our module plant in Nanjing,” said the spokesman. “China’s 30-inch grade TV market is set to grow quickly ahead of next year’s Beijing Olympics.”
He added LG would offer its 32-inch PDP screens at a lower price than similar-sized LCD panels but did not give a price. Production volume has yet to be decided.
LG trails Japan’s Matsushita Electric Industrial Co. and is ahead of local rival Samsung SDI Co. in the plasma business.
It said on Friday it would halt production at the smallest of its three domestic plasma panel lines before the end of June, a move analysts see as a step towards a broader restructuring.
Plasma screens, which once dominated the 40-inch-and-larger TV market with cheaper price tags and technical advantages, have been pummeled in a price war with liquid crystal display (LCD) screens backed by larger production lines and economies of scale.
Analysts expect plasma makers can enjoy price competitiveness for a while in the 50-inch-and-above segment, but the market has yet to grow as flat-screen TV demand is still focused on smaller sizes, particularly in emerging markets.
In South Korea, LG plans to focus on producing larger 50-inch plasma panels.
LG Electronics shares were up 0.87 percent to 69,600 won by 0303 GMT, compared with the wider market’s percent gain.
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