"The project, if launched, will reach a similar investment scale to those in Taiwan and South Korea," Nitin Kulkarni, president of Display Technologies of Corning China, said yesterday. More than US$1 billion was spent on plants in Taiwan and South Korea, Kulkarni said.
Corning Vice-Chairman and Chief Financial Officer James Flaws says the company has planned to spend US$1.2 billion to US$1.4 billion on this year's projects, with 75 per cent going to LCD projects. In the past two years, Corning has put combined funds of about US$1.86 billion in Japan and Taiwan to set up plants for producing the glass substrates. LCD is used in LCD television sets, notebook computers, flat panel desktop monitors and portable electronic and communications devices. "We are making a survey to study market conditions in the Chinese mainland and will then decide the investment scale," KulKarni said.
"Corning is discussing actively with the central and local governments about the project. "We are seeking policy support from the Chinese side since it is a heavily-invested project." Kulkarni said Shanghai is one of four possible locations for the project. He refused to reveal the other three possibilities.
"We hope the project will be finalized at the end of this year," said Clark Kinlin, chief executive officer of Corning China. Corning insiders said the investment plan is part of its expansion strategy in the Asian market over the next few years. Kinlin said China had a lot of potential in the sector, although it now only consumes a very small share of global sales. In preparation for its brewing investment plan, Corning has set up commercial operations in the Corning China Ltd Office to support the emerging China market. "We are full of confidence in the China market, which is growing fast in terms of LCD," he said. Kinlin said the global market will witness a growth rate of 40 per cent in LCDs this year, which should remain at the same annual rate until 2007. But he said the China market is expected to have a bigger growth rate than the average global rate. Global sales of LCD TV sets in 2004 took up only 5 per cent of all TV set sales. Corning believes the percentage will rise to 10 in 2005 and 21 in 2007. "The fact that more Chinese families are interested in LCD TV sets will be a strong stimulus to the growing demand for glass substrates," Kulkarni said. At present, global demand is 75 million square feet, which should jump to 500 million square feet by 2007, Corning predicts.