SANTA CLARA, CA – China is expected to surpass Japan in large-area TFT LCD panel production in the second quarter of this year, with Chinese suppliers indicating expanded production plans, says DisplaySearch.

Large-area TFT LCD panel production by Chinese makers, including mini-note, tablet PC, notebook, monitor, and TV applications, was 2.7 million units monthly in the first quarter, compared to 3.2 million units monthly from Japanese makers.

However, China will increase to 3.4 million units in the second quarter, while Japan is expected to fall to 2.3 million units. China is also expected to be higher than Japan in unit production from the third quarter of 2011 to the first quarter of 2012.

On an area basis, Japan will remain larger than China for some time, as there are higher generation fabs, including Gen 6, Gen 8 and Gen 10, in Japan. However, Chinese companies like BOE, ChinaStar and CEC-Panda will be ramping up Gen 6 and Gen 8 fabs within the year, and there will be more expansions in 2012, says the research firm.

Chinese TFT LCD makers still lag behind counterparts in Korea, Taiwan and Japan in new technology implementation.

Sharp, LG Display and other panel makers will start producing tablet PC panels in Gen 8 using advanced array and thin glass technologies. In 2011, 10% of Gen 8 capacity is being allocated to produce tablet PC panels.

The majority of the fabs producing mini-note and tablet PC panels will be Gen 5 and below, which accounted for 90% of these panels in the second quarter of this year, while Gen 6 and Gen 8 accounted for 10% during that period. According to panel makers’ production plans, in the first quarter of 2012, 25% of mini-note and tablet PC panels will be made in Gen 6 to Gen 8 lines.

CEC-Panda, which has acquired capacity and technology from Sharp, will not only make LCD TV panels in its Gen 6 line, but will also allocate 27% of its capacity for LCD monitor panels.

While Korean and Japanese panel makers like Samsung, LG Display and Sharp are allocating some of their Gen 8 capacity to non-TV applications, Taiwanese Gen 8 owners AUO and Chimei Innolux are allocating 100% of their lines to LCD TV applications.

HannStar will allocate more than 50% of its capacity to small/medium panel production, says DisplaySearch.

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