April 1, 2002

Taiwan is anticipated to suprasse South Korea as the biggest producer of large-size TFT-LCD panels in 2003, the Industrial Economics & Knowledge Center in Taipei predicted. The IEK was established under Taiwan's think-tank Industrial Technology Research Institute to promote cooperation between the government and the private sector.

The addition of five 5th -generation TFT-LCD plants in Taiwan would help the island to unseat Korea, the IEK told the press. Taiwan currently has five major makers: AU Optronics Corp., Chunghwa Picture Tubes, Ltd., HannStar Display Corp., Chi Mai Optoelectronicds Corp (CMO) and Quanta Display Inc.

The IEK also indicated that AU Optronics, CMA and Chungwa are expected to become the world`s 3rd, 4th and 5th largest TFT-LCD makers this year, while Samsung and LG-Philips of South Korea would remain the top two this year.
The expected output of the three Taiwan plants would accout for 12,%, 11% and 7.7% of the global supply.

In total, South Korean, Taiwan and Japan respectively supplied about 38%, 3% and 26% of the global demand for TFT-LCD panels in the first quarter of this year.

With the arrival of the 5th - generation plants,, the IEK said, TFT-LCD output in Taiwan will steadily shift emphasis to 17" and 18" panels, instead of today's mainstream of 15" types.

The IEK added that Taiwan's production is expected to rise in 2002 by 129% from last year, for the first time pulling ahead of Japan to become the second-largest supplier.

The center also said that Taiwan suppliers would become more competitive than their South Korean rivals, as Korean companies work all alone and for themselves, while Taiwan makers are developing their 5t-generation business through "industry clusters" Two such "clusters" in the making, the center said, are the LCD material zone under planning by CMO in southern Taiwan's Tainan Science-based Industrial Park, and an optoelectronics industry zone under development by Chunghwa near its 5th- - generation plant in Tayoyuan in Northern Taiwan. Both industry zones are expected to evolve into "industry clusters" supplying glass substrates, photo masks, color filters, backlight modules and other key components for all companies.