HSINCHU, Taiwan -- Major Taiwanese panel maker Innolux, an affiliate of key iPhone assembler Hon Hai Precision Industry, on Friday announced plans to lay off staff, without specifying how many, as the company braces for a drop in sales this year due to oversupply from Chinese rivals.
"We are expecting our revenue to fall from last year because the average sales price continues to drop,"
Innolux's new Chairman and Chief Executive Wang Jyh-Chau told reporters after the annual shareholders' meeting.
"With sales going down, we need to reduce overhead and the size of our staff," Wang said, declining to provide an exact figure.
Wang was officially appointed to his new positions on Friday by the company board, after his predecessor Tuan Hsing-chien departed Innolux last month for a new role overseeing the development of advanced panel technologies at Japanese electronics conglomerate Sharp Corporation. Hon Hai, also known as Foxconn, bought Sharp in April.
Innolux's staff has already shrunk to 69,000, from 98,000 at the beginning of 2015, due to increasing automation at production lines, according to Executive Vice President Shiao Chih-hung.
Wang's statement came after the company lost 8.58 billion New Taiwan dollars ($265 million) on revenue of NT$56.41 billion, down 43.6% year-over-year in the January to March period. Last year Innolux's net profit halved from its 2014 levels to NT$10.81 billion, due to Chinese rivals including BOE Technology Group and China Star flooding the market with large-size TV panels and driving down prices.
BOE surpassed AU Optronics, Innolux's main Taiwanese rival, and became the world's No.2 large-sized TV panel maker by shipments last year.
"Both Chinese and Korean panel makers have support from their respective governments, and that puts Taiwanese panel makers in a difficult position," Wang said.
He said that while Innolux may eventually collaborate with Foxconn-controlled electronics conglomerate Sharp on some projects, no concrete plans have been formed so far.