Sharp Considering Chinese Joint Venture

OSAKA (Kyodo) -- Sharp Corp. said Monday it has agreed to start talks on launching a joint venture in China to manufacture liquid crystal display panels using 8th generation glass substrates to meet growing demand in the fast-growing economy, a move that could lead to the Japanese maker's first overseas production of LCD panels.

The accord was reached between Sharp, Nanjing city and China Electronics Corp., the country's largest business group in the electronics and telecommunications sector.

The envisioned joint venture could also be a harbinger of Sharp's strategy aimed at completely localizing its LCD panel business from production to sales to avoid foreign currency risks.

Sharp also announced that it will sell equipment for the production of LCD panels using 6th generation glass substrates at its Kameyama plant No. 1 in Mie Prefecture to a joint venture set up by Nanjing city and China Electronics for an undisclosed price.

The production line has been suspended.

Sharp, the maker of Aquos brand TVs, plans to start production using 10th generation glass substrates in Sakai, Osaka Prefecture, in October.

The Osaka-based manufacturer has produced LCD panel TVs at its factory in Nanjing since 2001 by sending panels from the Kameyama plant.

If Sharp can procure LCD panels through the joint venture, the Japanese maker will be able to strengthen the cost competitiveness of its flat-screen TVs, observers said.

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