TCL Accelerates China s TV Industry Transformation LCD Module Plant Starts Operation

TCL Accelerates China s TV Industry Transformation LCD Module Plant Starts Operation

December 29th,2008

22 December 2008 - TCL Corporation held a grand ceremony today in Huizhou s Zhongkai National High-Tech Development Zone for the release of its LCD module plant begins operation. Work was also begun on the project for the LCD TV module integration. This LCD module project has wide-reading implications and necessitates a higher level of technology than any other comprehensive project currently being undertaken in the domestic TV manufacturing industry.

Commissioning of this project marks that, TCL Corporation, as the representative corporation of China s TV manufacturing industry, has taken a key step in core competitiveness in the production of new flat panel TVs and upgrading of the industry as a whole.

According to plans, phase one annual production capacity for the TCL LCD module project should reach 2.33 million sets. After commissioning of its phase two of LCD TV module integration project in 2009, the annual production capacity would be expanded to 3 million complete LCD TVs and 2 million semi-finished LCD components. Through of vertical integration, the production cost of an LCD television (including shipping and storage costs) will be lowered, and a significant increase in value will be seen.

It is understood that the module project holds an important position in the added value of flat panel all-in-one television appliances. A production intervention on such a massive scale and the effective maximization of its investment returns can, on the one hand, satisfy the rapid increase in demand for TCL Corporation LCD TVs, and on the other hand, free people from their dependence on key parts, allowing the industry to advance and expand, lowering costs, and raising the added value of color television products.

According to estimates, in 2009, the production capacity of TCL Corporation LCD televisions will exceed 5 million, with production of this module not only satisfying demand in the domestic market but also being applied to the company s manufacturing in the European and North American markets.

Guangdong Information Industry Department Head Wen Guohui, who attended the TCL LCD module plant opening ceremony, explained, The successful start-up of TCL s LCD module plant not only strengthens the enterprise s core competitiveness, but also carries great significance for the structural readjustment and advancement of the Information industry of Guandong Province as a whole.

The Mayor of Huizhou city Mr. Ruqiu expressed his opinion on the project, saying, The TCL LCD module project is a key element in the upgrading of color television technology. It provides an industrial pillar of strength for Huizhou that will lead to the development of relevant complementary industries, and it provides a positive force in raising the competitiveness of Huizhou s electronics industry in Guangdong Province and even the whole country.

As TCL Chairman Li Dongsheng explained, The LCD module project is part of TCL s strategy for firm and steadfast development. At present, TCL has already made full preparations for the core technologies involved in module production as well as the selection and training of qualified personnel. The mass production of TCL s LCD module will reduce costs in the manufacturing of television appliances and strengthen the market competitiveness of all-in-one television sets.

With completion of the integration pattern of the module and complete appliance, TCL will have taken a critical step in the acceleration of industry transformation and advancement.

According to a public announcement by TCL Corporation, TCL LCD TV sales for the first 11 months of 2008 reached more than 3.5 million, increasing 239% from last year and continuing to maintain a steady and smooth pace of growth. Industry analysts expect that, according to current market condition forecasts, the Chinese flat panel television market will maintain a growth rate of more than 50%, with a market inventory that should reach 20 million TV sets.

With the assistance of the national program Home Appliances to the Countryside and other programs designed to stimulate domestic demand, popularization of flat panel televisions should be accelerated in 2009. This is particularly true for tier 3 and tier 4 markets where the emergence of explosive growth patterns is possible.

All of this brings a wealth of opportunities for TCL s LCD television production and aids in accelerating the development of the LCD module industry.