(Reuters) - South Korean panel maker LG Display Co Ltd (KS:034220) will halt domestic production of liquid-crystal display (LCD) TV panels by the end of this year, its chief executive said on Monday, due to dropping LCD prices and a global supply glut.
The suspension of domestic LCD TV production comes after the company last year chopped its spending, replaced its long-time CEO and started a voluntary redundancy program.
"We will be wrapping up our LCD TV production in South Korea by end of this year and focusing on our LCD TV production in China," CEO Jeong Ho-young said at the annual CES trade show in Las Vegas.
In October, the South Korean Apple (O:AAPL) supplier said it planned to "downsize" two of its LCD TV panel production lines in South Korea and was looking into various options.
LCD TV businesses accounted for 32% of LG's revenue in the July to September period, down from 41% the previous quarter due to fewer shipments from its LCD TV panel plants.
LG Display operates two LCD TV production sites, one in South Korea and another in China.
The company suffered three consecutive quarterly losses between January and October last year, but Jeong said the panel maker is expecting to see "further improvement" in its performance in the second half of this year.
While terminating domestic LCD TV production, LG Display aims to shift its focus to organic light-emitting diode (OLED) technology. It expects the newer technology to account for 50% of revenue by 2021, up from about 30% in 2018.
"We plan to build systems to mass-produce OLED products in our Chinese factory by end of the first quarter this year," Jeong said.
He said the company was not planning to shift the LCD TV production lines marked for closure in South Korea into OLED panel production.
LG's cross-town rival Samsung Display, a unit of Samsung Electronics Co Ltd (KS:005930), said in October it had suspended one of its LCD production lines in South Korea.
It also announced a 13.1 trillion won ($11.25 billion) investment in facilities and research to upgrade a production line.
($1 = 1,164.1500 won)