Oct 28, 2001

Despite the slowing wold economy, the total production value of Taiwan's optoelectronics industry this year is expected to reach US$ 13.8 billion with an annual growth of 31%, according to statistics compiled by the China External Trade Development Council (CETRA) .

Since 1995, the optoelectronics industry has averaged annual growth rates of 20% to 30% and still has ample room for growth, the organization said.

That is because Taiwan's total output of optoelectronics only accounted for about seven percent of the total world production so far, according to Yung S. Liu, director general of the Opto-Electronics & Systems Laboratories (OESL) of the Industrial Technology Research Institute (ITRI)

The TFT-LCD sector will continue to be an important part of this industry. Over the past four years, Taiwan total investment in the LCD sector topped NT$255 billion, and the industry witnessed an increase of 400% in the number of manufacturers, a 600% increase in the number of production lines, and a multiple of 14 in growth in production value. Taiwan is now undoubtedly the world's major prduction center for medium and large size TFT-LCDs.

Taiwan currently has seven LCD manufacturers with a monthly production capacity of 445,000 pieces of LCD substrates.

According to Chen Mon-cheng, an industry analyst of ITRI's Industrial Economic Knowledge Center, Taiwan's large size TFT-LCD makers have demonstrated outstanding performance so far this year.

The production value of large size TFT-LCDs in the second half of this year is estimated to post a whopping increase of 90% over the same period of last year. Although these makers have been suffering from plummeting prices, industry researchers indicated that prices in the fourth quarter might stop declining.

The production value of medium and small size TFT-LCDs is expected to see a 20% decline from the same period of last year.

The production value of medium and small size TN (Twisted Nematic) and STN (Super Twisted Nematic) LCDs is estimated to show a decline of 16.4% from the same period of last year and a decline of 10% from the first half of this year. This figures show that the future of TN/STN LCDs is bleak

By combining the production values of all of the aforementioned categories, Taiwan's LCD industry will reach NT$120.23 billion this year, constituting a growth rate of 42% over 2000.

In order to pursue sustained growth, LCD makers are taking various strategies to maintain competitiveness, one of them being to boost economies of scale by merging. On September 1, Acer's LCD manufacturing unit merged officially with United Microelectronics Corp.'s LCD manufacturing unit to form AU Optronics Corp, which is now among the world's top three largest TFT-LCD makers.

According to AU officials, after the merger the company has five FTF-LCD fabs with monthly production capacities of 700,000 large panels and one million medium and small panels.

OLEDs

Taiwan's optoelectronics makers have also branched into production of OLEDs. The OLED technology was developed by Kodak, which enables full-color, full-motion flat-panel displays with a high level of brightness and sharpness, a display quality which is not available on other types of display devices. Unlike traditional LCDs, OLEDs are self-luminous and do not require backlighting. Thise attributes eliminate the bulky and environmentally undesireable mercury lamps and yields a thinner, more compact display.

Miscellaneous Optronics

Taiwan's makers of CD-RW, CD-R, and optical communication devices are reported to continue faring will. Leading makers such as Lite-On IT Corp. and Behavior Technology Computer Co. have obtained sizeable OEM orders recently.