Businessweek

AU Optronics Corp. engages in the research, development, production, and sale of thin film transistor liquid crystal displays (TFT-LCDs) and other flat panel displays. Businesses The company operates in two businesses, Display Business and Solar Business. DISPLAY BUSINESS The company designs, develops, manufactures, assembles, and markets flat panel displays and most of its products are TFT-LCD panels. Its panels are primarily used in computer products (such as notebook computers and desktop monitors) and consumer electronics products (such as mobile phones, digital photo frames, digital still cameras, portable navigation display, and portable DVD players), LCD televisions, automobile, and industrial displays. The company's Display business is divided into three business groups, namely Video Solutions, Mobile Solutions, and Touch Solutions. The Video Solutions Group covers applications, such as LCD televisions and desktop monitors. The Mobile Solutions Group mainly covers applications, such as smartphones, notebooks, and audio video products. The Touch Solutions Group covers touch panel products. Principal Products The company offers a range of display panels for the following principal product categories: computer products, which typically utilize display panels ranging from 7 inches to 27 inches, primarily for use in notebook computers and desktop monitors; consumer electronics products, which typically utilize display panels ranging from 1.5 inches to 10.4 inches or above for use in products, such as mobile phones, digital photo frames, digital still cameras, portable navigation display, portable DVD players, digital camcorders, automobile display, amusement and printer displays, e-readers, and portable gaming consoles; and LCD televisions, which typically utilize display panels ranging in size from 18.5 inches to 65 inches. The company’s product mix for notebook computers primarily includes 10.1- to 17.3- inch panels. The commonly produced panel sizes for notebook computers have been 10.1, 14.0, and 15.6 inches. In 2011, 18.5-, 21.5-, and 24-inch panels were commonly produced for desktop monitors. Customers, Sales, and Marketing The company sells its panels primarily to companies that design and assemble products based on their customers’ specifications, commonly known as original equipment manufacturing service providers, or brand customers. The company sells majority of its panels for digital still cameras and camcorders to brand companies based in Japan, Europe, and the United States. It sells its panels for automobile display primarily to component manufacturers for automotive audio and video products based in the United States, Japan, the People’s Republic of China (the PRC), and Europe. The company sells its panels for portable DVD players primarily to original equipment manufacturing service providers and component manufacturers, majority of whom are located in Taiwan, the PRC, and other Asian countries. It sells a significant portion of its panels for mobile device products to mobile phone brand companies and original equipment manufacturing service providers in the United States, Europe, Japan, Korea, and the PRC. In 2011, its major customer included Samsung Electronics Co., Ltd. (Samsung). Suppliers The company's suppliers include Asahi Glass; Chisso Corporation; Cando Corporation; BenQ Material Corporation; Coretronic; Renesas Electronics Corporation; Corning Taiwan; DIC Corporation; Dai Nippon Printing; Nitto Denko; BriView Corp.; Novatek; Nippon Electric Glass; Merck; Toray Industries, Inc.; Sumika Technology Co., Ltd.; Forhouse; Orise; Toppan CFI; Radiant Opto-Electronics; and Raydium Semiconductor. Competition The company’s principal competitors include LG Display Co., Ltd. (LG Display) and Samsung in Korea; Chimei Innolux Corp., Chunghwa Picture Tubes, Ltd., Hannstar Display Corporation, Wintek Corporation, Giantplus Technology Co., Ltd., and E-Ink Holdings Inc. in Taiwan; Sharp, Toshiba, IPS Alpha Technology, Ltd., Hitachi Displays Ltd. (Hitachi), and Japan Display Inc. in Japan; and BOE Technology Group Co., Ltd., InfoVision Optoelectronics (Kunshan) Co.,