Allied Material to expand CF production

Taipei, July 22, 2004 (CENS)--Allied Material Technology Corp, invested in by Taiwan's China Steel Corp., recently resolved to invest approximately NT$50 billion (US$1.47 billion at US$1:NT$33.8) to boost production of color filter (CF) at its sixth-generation plant.

The company said it will undertake technical cooperation with Toppan Printing Corp. of Japan to join the production of the sixth-generation CF.

Allied Material President Chou Kuo-hui noted his company has decided to establish a new plant on a 20-hectare production site in Luchu of Kaohsiung County, southern Taiwan. Designed to have three production lines, the proposed new plant will break ground in September this year and began equipment installation in October. The new plant is expected to become operational sometime in 2006.

Domestic optoelectronics manufacturers to cooperate with Dai Nippon Printing Co. of Japan in the production of sixth-generation CF include Sintek Photronic Corp., Quanta Display Corp., South Sintek Photronic Corp., and HannStar Display Co.

Of them, Sintek will invest NT$15 billion (US$443.78 million) to set up a sixth-generation CF plant in Yunlin County, central Taiwan. The new plant will break ground in August this year and complete construction in June next year.

Dai Nippon's rival Toppan Printing owns a fifth-generation CF plant and has begun construction of a sixth-generation CF plant in Tainan County, southern Taiwan. Toppan Printing's cooperative partners in Taiwan include Allied Material and AU Optronics Corp.

Chunghwa Picture Tubes, Ltd., an optoeletronics subsidiary of the Tatung Group, is said to have talks with Toppan Printing and Dai Nippon for technology cooperation, yet not finalized.

Of domestic flat-panel manufacturers, Chi Mei Optoelectronics Corp. will set up a 5.5th-generation plant while others, including AU Optronics, Chunghwa Picture, Quanta Display and HannStar, will establish sixth-generation plants with own CF production facilities, said Sintek president Chang His-chiang

Chang warned if the above-mentioned flat-panel manufacturers materialize their investment projects, domestic production of sixth-generation CF will face an oversupply problem.

Chou Kuo-hui said domestic manufacturers of flat panels are rushing to ask CF producers to lower product prices because of sluggish demand for flat panels.