AGC: 5th furnace investment project in Taiwan

Japanese Asahi Glass Co., Ltd. (AGC) recently decided to restart an investment project for its fifth glass furnace in Taiwan.
According to industry sources, AGC“s aggressive move is expected to push…

Japanese Asahi Glass Co., Ltd. (AGC) recently decided to restart an investment project for its fifth glass furnace in Taiwan. According to industry sources, AGC“s aggressive move is expected to push glass-substrate prices down thanks to increasing competition between the world“s top-two glass-substrate suppliers Corning and AGC. AGC“s capacity expansion is expected to lead to more flexible substrate prices in the future. Substrate is the second most expansive panel key part after backlight units, therefore, a decrease in substrate prices could lower panel makers“ cost. AGC already operates four furnaces in Taiwan and was scheduled to invest TWD 12 billion (USD 352.9 million at USD 1: TWD 34) to construct the fifth in August 2008, to be completed in early 2009. The project, which is expected to increase AGC“s substrate capacity by 20%, was, however, delayed due to the frozen panel market in the fourth quarter of 2008, when AGC immediately decided to put the project on hold. Statistics carried out by DisplaySearch, the display market researcher and consultant, show that Corning is presently the world“s largest supplier of glass substrates with a global share of around 56%, and AGC is the second-largest player with 20%. with regards to Taiwan, Corning now supplies 51% of market, while AGC 30%. And, therefore, according to industry insiders, AGC“s aim is that of to competing with Corning on the island. AGC Group chief operating officer,Kazuhiko Ishimura, had previously suggested to expand AGC“s capacity in Taiwan from four furnaces to six, and then to 10 if the demand continued to increase, expecting Taiwan to become AGC“s largest substrate production base in Asia.