Hitachi to Build New Plasma TV Panel Factory

By Kyodo News International, Tokyo

Jan. 28–TOKYO — Hitachi Ltd. is mulling building a new factory to boost production of plasma TV panels to help meet soaring demand for panel TVs, company officials said Saturday.

The company is expected to spend some 100 billion yen on the new factory, aiming to have it become operational as early as 2008, sources familiar with the matter said.

In addition to sharp increases in global demand for panel TVs, active capital spending by Matsushita Electric Industrial Co., which holds about a 30 percent share in the world market for plasma TVs, and Sharp Corp., a major maker of liquid crystal display TVs, is behind Hitachi’s decision, the sources said. Hitachi has less than a 10 percent share of the market.

The new factory is likely to be built in Miyazaki Prefecture by expanding a factory of its affiliate Fujitsu Plasma Display Ltd. there, the sources said. Hitachi holds an 81.1 percent stake in Fujitsu Plasma.

Hitachi had planned earlier to boost the output of such panels at the Fujitsu Plasma factory from 100,000 a month to 300,000 within fiscal 2007 through March 2008, but it decided to seek an additional increase by building the new factory, according to the Hitachi officials.

Hitachi hopes to see increased profitability by improving manufacturing efficiency at the new factory, the officials said.

The company is expected to incur an operating loss of more than 10 billion yen in the plasma business in the current fiscal year through March 31.

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