LG.Philips to invest $5.1 billion in new LCD line

[RuffRyders]

[b]LG.Philips to invest $5.1 billion in new LCD line[/b]
[font=\"Arial\"][i]LG.Philips LCD, the world's second-biggest maker of liquid crystal displays, on Tuesday announced a $5.1 billion investment plan to build a more advanced production line.[/i]

The plan comes amid a continuing fall in flat-panel prices due to a supply glut caused by weaker-than-expected demand.

LG.Philips on Friday said liquid crystal displays (LCD) prices would fall by more than 15 percent in the fourth quarter, following a one-fifth fall in the third quarter.

The so-called "seventh-generation" (7G) production line was expected to begin mass production in the first half of 2006, an LG.Philips spokesman said. He did not elaborate but said the company would unveil details on Wednesday.

LG.Philips said in a filing to the local stock exchange it would spend 5.3 trillion won ($5.06 billion) to build the new production line. The investment was aimed at enhancing its production capacity and "to be prepared for the future growth in the LCD market," the company said.

LG.Philips is a joint venture between LG Electronics and Philips Electronics.

Flat-panel prices have nose-dived because consumers are not buying the expensive flat-screen televisions in the volumes expected by makers spending billions of dollars to ramp up production.

LCD makers are also shifting to bigger pieces of glass because it allows them to reduce manufacturing costs. But the move to higher generations requires new production tools and heavy capital spending.

S-LCD, a venture between top LCD maker Samsung Electronics and Sony, is the world's leading 7G operation.

[size=1]Story Copyright © 2004 Reuters Limited. All rights reserved. [/size]

[url=\"http://news.com.com/LG.Philips+to+invest+5.1+billion+in+new+LCD+line/2100-1041_3-5473851.html\"][Source][/url][/font]