Tainan: Innolux Corp., a leading flat panel manufacturer in Taiwan, has announced plans to close a factory in the Southern Taiwan Science Park. This decision is part of a strategic move to decrease its focus on flat screen production within its overall product portfolio.

According to Focus Taiwan, market analysts suggest that this move reflects a downturn in the global market. Innolux has assured that production currently handled at the plant will be transferred to other facilities, ensuring there will be no disruption in supply for its clients. The company has committed to maintaining production quality and meeting existing orders, despite the closure.

Local news media reports indicate that the plant will be phased out by mid-2026. Innolux has stated its intention to reallocate resources to other areas with potential for long-term growth, although specific plans for the factory's future will be disclosed at a later date.

In a related strategic expansion, Innolux recently announced that its subsidiary, CarUX Holding Ltd., will acquire Japan's Pioneer Corp. This acquisition is aimed at enhancing CarUX's presence in the Asia-Pacific market and broadening its global business portfolio in the automotive electronics sector.

This closure follows last year's sale of another plant in the same science park to Taiwan Semiconductor Manufacturing Co. (TSMC) for NT$17.14 billion (US$587 million). This transaction included equipment and aimed to expand TSMC's capacity for advanced 3D Chip-on-Wafer-on-Substrate (CoWoS) IC packaging services, vital for artificial intelligence chips. Innolux reported earnings per share of NT$0.78 in 2024 following the sale, helping to alleviate previous losses in its panel business.

The plant sold to TSMC and the one set for closure were both 5th to 5.5th generation plants, which specialized in producing displays for notebook computers and medium to small-sized screens. Despite these sales, Innolux retains two other 5th-generation facilities.

Meanwhile, Innolux's competitor, AUO Corp., has also sold two plants-one in Taichung and another in Tainan-to Micron Technology Inc.'s Taiwan subsidiary for NT$8.1 billion. AUO stated that the sale was designed to optimize its property use and enhance its financial structure.