China's TV sectors have expressed skepticism over the business opportunities for two China-based companies, Chang Hong Electrical Group and Irico Group Electronics, in their acquisition of control of Korea-based plasma TV maker Orion PDP.

China's National Development and Reform Commission have reported that a joint-venture between Changhong (the fourth-largest Chinese TV maker) and Irico (China's biggest CRT TV maker) has acquired 75% of Sterope Investments in the Netherlands for US$99.9 million. The Dutch firm holds the South Korean firm Orion PDP.

Representatives from a PDP modules maker who recently visited Changhong pointed out that the acquisition of Orion will shorten the Chinese company's development of PDP TVs.

However, Orion's production is rather small, with monthly output totaling less than 10,000 units, the sources said. Changhong's PDP TV output is also less than 5,000 units per month. Changhong will need to tackle the problem of how it can significantly increase its output.

PDP TV makers in China will also have to overcome the shortage of components, which chiefly come from Japan, the sources said. China's PDP TV makers may not be able to lower their costs fast enough to withstand the competition from LCD TVs.

PDP TVs continue to be squeezed by LCD TVs in the Chinese market. As of September 2006, LCD TVs accounted for 70% of China's flat-panel-display (FPD) TV market, while PDP TVs' share had shrunk to 30% from the previous 60%.

Source:佚名