Japan Display Inc. and Chinese display maker HKC Corp. have agreed to jointly build factories in China to produce a next-generation organic electroluminescent display, with plans to start mass production in 2025, JDI said Monday.
The total investment for the joint project could amount to hundreds of billions of yen, the Japanese firm said. HKC will cover the costs of factory construction while JDI will provide the expertise for manufacturing the product.
The two companies will work on the production of a new type of EL display called eLEAP, which was developed by JDI and is of a higher quality than existing models in terms of brightness and product life.
"Combining JDI's proprietary Global No.1 technologies and manufacturing capabilities with HKC's cost competitiveness and sales strengths...will contribute to a significant increase in both JDI and HKC's corporate value," JDI CEO Scott Callon said in a statement.
JDI will aim to boost sales of the product for cars and wearable devices through its collaboration with HKC.
HKC has grown through its robust sales of large-size displays in recent years and is planning to list its shares in China soon, according to JDI.
The tie-up is the latest development seen in an industry that has experienced a decline in Japanese manufacturing.
JOLED Inc., an organic light-emitting diode display company created through a merger of Panasonic Corp.'s and Sony Corp.'s operations, filed for court protection in March.
JDI was established in 2012 following the merger of the display operations of Sony, Hitachi Ltd. and Toshiba Corp. with support from the state-backed fund INCJ Ltd.
However, due to increased competition with overseas rivals, the company has been struggling recently, posting a net loss for the eighth straight year up to March 2022.
JDI likely stayed in the red for the fiscal year that ended last month, with a net loss projected to be about 31.9 billion yen ($240 million), according to the company, which will announce its 2022 results in May.
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