Foxconn considering expansion of China TV plant

BEIJING, CHINA: Taiwan's Foxconn Group, maker of Apple Inc's iPhone and iPad, is proposing an expansion of its LCD television production site in eastern China and is talking to clients about the idea, a Chinese official said on Wednesday.

Eyeing burgeoning demand from the Chinese TV market, which is set to become the world's largest, Foxconn was seeking to expand its Yantai plant in Shandong province, but still needed the approval of top client Sony Corp, the official said.

"The situation is still not clear," said the official, requesting anonymity because of the commercial sensitivity of the matter. "There are difficulties or uncertainties about cooperation on the Japanese side. This is an idea of Foxconn's; it's a proposal but it still needs a lot of work."

The official did not say whether the proposal would involve any investment from Sony.

A spokesman for Foxconn unit Hon Hai Precision Industry Co Ltd said he had not heard of any cooperaton with Sony, while the Japanese company denied any plan.

"Sony has no plan to invest in any TV manufacturing plant in China owned by our OEM suppliers," said Sony spokeswoman Kumie Tanaka.

China's Economic Observer newspaper reported on its website that the expanded plant would have a capacity of 30 million panels per year and would hire about 50,000 staff.

Foxconn, which also operates through Hong Kong-listed Foxconn International Holdings Ltd, is already one of the biggest private-sector employers in China. Last October, the government of Chengdu city in western China said Foxconn would invest $2 billion in a new plant there.

Meanwhile, Sony has been pursuing an asset-light strategy for the last couple of years, and any investment in a plant would be seen as a surprise. It has sold manufacturing sites in Slovakia and Mexico to Hon Hai in the last two years.