A TFT LCD Fab in Brazil? Don’t Bet Against It

By John Jacobs – Director, Notebook Market Research, DisplaySearch

The government of Brazil and the Brazilian Development Bank (BNDES) have identified display technology as a key component of their plan to encourage high tech investment and manufacturing. The government has been in the process of changing their economy from exporting raw materials to foreign markets and importing high tech components and products to an economy that is capable of supplying its domestic markets with high tech components and products and eventually becoming a net exporter of technology.

Brazil does not underestimate the challenges in front of them. Rather, they understand the necessity of beginning with the low-tech side of the display industry and are in the process of establishing module lines to support their domestic market.

The potential market for displays in Brazil is substantial. The population of Brazil is slightly less than 200 million, and unlike the US, Japan, and Western Europe, the population is not “graying,” but tends to be younger. While mobile phone penetration is relatively high, only 12 million PCs (including notebooks and desktops) were sold in the country in 2009, and less than 3 million flat panel TVs were sold in the country last year. Brazil expects that the World Cup, which it will be attending later this year, will drive demand for flat panel TVs. The 5% average Y/Y GDP growth that is forecast to occur every year through 2014 should help drive demand for PCs from the enterprise and consumer markets as the economy continues its steady expansion.

Representatives from Brazil have confirmed that they have received several proposals for the construction of a fab, which they are evaluating. They believe that with the right partner, probably an existing TFT LCD manufacturer, they could have a TFT LCD fab in mass production by as early as 2013.

David

I think that the pontential of BRAZIL is big and enough to drive the new biz. and maybe The japan-based-companies and koeas-based-companies
are interested to this plan…
decjulia

Do you meant Samsung & LG ? does any famous local exterprises in Brasil will also want to making panel for their local demand?
Kobayashi

The Manaus Free Trade Zone just published tax benefits for locally assembled LCD modules. The benefits to the TV maker could between around 7 to 8% depending on the industrial value of the TV. On a 32″ TV that’s about $26 in benefits. Philips in March started assembling local LCDMs using a Japanese LCD maker’s components. Who will be next to follow?
http://www.vertexlcd.com Ken

Hi John, it’s a great report. It looks like there will be plenty of supply in near future. Probably, more than needed.
Gerald P.

It has been rised for several years by top tier CRT TV manufacturers in Bazil to intend to localize LCD panel manufactured in Brazil. But they can’t do it by themselves, seeking for current LCD panel manufacturer to be partner is their solution what they have been trying.
On viewpoint of population of Brazil and south America, local manufacturing LCD panel should be a reasonable option. Even market of north America could be considered!
http://www.abinfo.com.br/ld2010 Alaide

John

Thank you for your nice report. The stupend reaction indicates that we are in the right direction…
http://www.cti.gov.br Mamoru

Today’s Brazil has a sound economy, controlled inflation, rising exports
and the economy is groing at a moderate pace. So we have the basis to begin
developing and exporting innovative technology products. Why not TFT LCD FAB
in Brazil??? The country is a mass consumption economy, that’s a natural way.
It still has challenging issues, but investiments will strenghen research
lines, granting the industry with a whole new market possibilities.
Alex Paulo

There are many factors indicating that Brazil is prepared to house production lines in high-end display components. Well as quoted by John, our large domestic consumer market is a key. Brazil crossed the world crisis of 2009 partly due to its domestic consumption. Other factors that may be mentioned are several coordination activities between government and industry that has been done in the past 30 years. It seems to me that the country has finally reached the point of convergence between the wishes of government, industry expectations and opportunities of the global market.
Ricardo

Just like several products, as motorcycles, cell phones and CRT-TV, the Manaus Free Trade Zone can be an important site for starting the LCD manufacture. Furthermore, several other states (e.g. Sao Paulo e Rio Grande do Sul) offer not only tax incentives for high tech and consumer foundries to install, but also a high skilled and educated workforce and strong research centers and universities.
All we need are partners interested on investing in Brazil.
Mário Sandro

“Do not put all your eggs in one basket” is a maxim that investors, big or small, should take to heart. The rapid growth of Brazilian economy in the last years and the increasing purchasing power of its population make Brazil one of the most promising markets for investment these days. Besides, developing high tech industries is a natural trend of emerging countries. The widespread use of LCDs and its surprising new possibilities in the display world re-enforce the reasons to bet in a TFT LCD Fab in Brazil.
Thauana

I agree that Brazil has a great potential to create a LCD Fab, there is a huge number of researchs for this kind of technology that will help Brazil to succed in creating such a fab until 2013. By then, people with low economic conditions will have the opportunity to get a LCD TV at home.

And that will be great, financially speaking, for the Country.