LCD supply chain: reservations welcome

摘要

Adeal such as the one recently inked between LCD maker Chi Mei Optoelectronics and glass supplier Corning is nearly unheard of in the electronic components supply chain. In July Chi Mei agreed to prepay Corning $510 million for "a significant amount" of glass for the manufacture of large-screen LCD TVs. In the electronic component supply chain—long dominated by concepts such as just-in-time manufacturing and, more recently, risk management—nobody wants to order, let alone pay for, a significant amount of inventory in advance. Overly optimistic forecasts in 1999 and 2000 led to an inventory excess of more than $13 billion by 2001. Nobody wants to hold inventory, either. In fact, many OEMs use distributors to warehouse parts they think they might use but don't pay for them until they're pulled from distributors' shelves. Even Corning admits that the Chi Mei deal is unusual—this is the first time Coming's Display Technologies division has ever inked such an agreement. (Other divisions of Corning, such as its fiber optics division, have made such deals in the past, however.)