Taiwan- and Japan-based flat panel makers began to reduce their production recently, lowering their capacity utilization rates to 60-70% on average, and even to below 50% for some production lines. However, Korea-based rivals seem to have taken the opportunity to expand their market share optimizing on their cost advantage.

The capacity utilization rate at AU Optronics (AUO) reportedly has lowered to 75% recently, while Chi Mei Innolux (CMI) is running at 60-65%. Sharp is operating at 70% on average, but the utilization rate of its 10G lines is only 50%, the sources indicated.

However, the 7G and 7.5G production lines of Samsung Electronics and LG Display are still running at 90% due to the complete depreciation of those production lines, the sources added.

The strategy adopted by Korea-based makers will apparently delay the timing for which the supply and demand of flat panels reaches a balance, commented sources, adding that prices for large-size panels are unlikely to bounce back until the first half of 2011 under current circumstances.