LG Plans to Reduce Capital Investments as Tablets Hit the Popularity of LCD

Tablets and similar devices are overtaking the market place of LCDs as a result of which, LG plans to cut its capital costs by next year which will be a major setback for the company.

LG LCDWith constant evolution in the technology sector, there is an increasing interest of users in tablets than any other computing or visual gadget. The popularity of tablets has forced the LCDs to take a back seat and to escape a huge downfall; LG has planned to cut down its capital expenditure for the next year, 2012. This news is huge as LG is a known television manufacturer.

The company has planned to reduce its cost in an effort to maintain their stakes and position in the market. This will be the company’s lowest expenditure cost ever. Now it is for all to see whether it proves to be beneficial or takes the name down.

The loss state is not being experienced by LG only. The same is the case with Phillips and Sony who are undergoing a downfall constantly. They are in the lowest of their ever states, all because they are being pushed back by the new in thing and that is tablets!

John Soh, an analyst at Shinhan Investment & Securities expressed his views upon the falling stakes of LG and other television manufacturers of the world. He said on Monday, “LCD makers will keep 2012 investment plan conservative and LG is also likely to cut spending again as visibility is very low due to weak demand especially from Europe and the United States.   LG is likely to report losses widening in the current quarter and the outlook for the next nine months is dreadful due to weak demand. “

Not only are LCDs facing this downfall and low demand, but also personal computers and TVs are running short of demand! This is a major concern amongst many enterprises as they depend largely upon these manufactured electronics which is now low on demand and gradually deteriorating!!!

“We plan around 3 trillion won ($2.8 billion) of capital spending next year and have no plans to build a new factory,” a LG Display spokesman said, confirming comments made by its chief executive to local media in an interview.

The briefing given by the spokesperson of LG is clearly indicating that the company does not intend to manufacture more LCDs and will now have to look up to new technology in order to make it big in the market.

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