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AUO and Innolux Announce Major Production Line Overhauls Amidst Industry Transformation

AUO Shuts Singapore Plant and Innolux Closes Tainan Line; Companies Shift Focus to Sustainable and Advanced Technologies
Taiwan
a 2409.TW i 3481.TW Mid and Small Cap 2000 Tech 350
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In a significant shift within the display panel industry, AUO and Innolux, two major players in the field, have announced the closure of several production lines as part of a broader strategy for transformation. This move marks a decisive step towards optimizing operations and aligning with current environmental and technological trends.

AUO confirmed the closure of its Singapore LTPS plant by year-end, a decision driven by the company’s focus on long-term competitiveness and global resource allocation. AUO Chairman Peng Shuanglang emphasized the need to evaluate the production capacity and operational efficiency of each factory. Some equipment and buildings in Singapore will be sold, while other assets will be relocated to the Longtan factory in Taiwan. In terms of personnel, the company plans to comply with local laws for production line employees and retrain engineers for a new company in Singapore, aligning with AUO Digital. This transition also coincides with the upcoming production launch of AUO’s Vietnam factory.

Innolux is taking similar measures, announcing the closure of its 5.5-generation line in Tainan and scaling back module factories in China. General Manager Yang Zhuxiang outlined that more than 300 employees affected by the Tainan closure will be reassigned within the company. Innolux is also adjusting its production strategy, focusing on automation and exploring overseas expansions, including potential ventures in India and Mexico.

The strategic overhaul extends beyond just facility closures. AUO plans to revitalize old production lines with new technologies, including the introduction of Micro LED technology at Longtan. This innovative approach has already yielded results, with the shipment of the first high-quality watch equipped with AUO Micro LED. The technology is also being adapted for automotive applications, moving from concept to commercialization.

Innolux, on the other hand, has recently inked a technical cooperation agreement with India’s Vedanta Group. This partnership could open new avenues for technology transfer and long-term collaboration, particularly in emerging markets like India.

Chairman Hong Jinyang of Innolux indicated that while the company initially focused on licensing technology, there is potential for more extensive cooperation as older panel lines are replaced. This aligns with the company’s strategy to identify new production bases, notably in India, to stay competitive in the evolving global market.

These closures and strategic shifts underscore a pivotal moment for the display panel industry. As companies like AUO and Innolux pivot towards more sustainable practices and advanced technologies, they set the stage for a new era in the sector, balancing environmental concerns with the pursuit of technological advancement.

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