Known for being one of the giants of the Smart TV market, LG announced on Wednesday (10) that it should start producing OLED panels in China. According to the South Korean giant, the factory in Guangzhou city is due to come on stream next month.
With this, the LG Display ends up “swimming against the tide” when installing a factory in the Asian giant. This is because China’s trade war with the United States has caused many technology giants to begin shifting production to Vietnam.
Even so, LG says that China will be the best option to complement its production of South Korean OLED panels. Thus, the Guangzhou factory will be responsible for up to 60,000 substrates per month. This should raise LG Display’s capacity to 130,000.
LG also confirmed that the first quality tests should be done later this month, and plans for the future are for the Chinese factory to increase its production gradually. This should depend on market demand and negotiations with the Chinese government.
That’s because the company had to convince Beijing to authorize the installation of the production line in Guangzhou. As a result, the factory-built by LG operates in a joint venture of the South Korean giant with local authorities (the division was 70% for LG and 30% for the government).
The total investment in China is $ 2.3 billion, with the South Korean government agreeing to LG’s action. However, with the Japanese trade embargo, we still do not know how the manufacturer will get essential components that have been blocked for companies in South Korea.