UPDATE 1-Samsung Display says to build $1 bln Vietnam plant
* Samsung subsidiary building new display module assembly plant
* Samsung Display says production expected to start in 2015
* New Vietnam facility to help with cost reduction (Adds comments from Samsung Display, background)
SEOUL, July 3 (Reuters) - A subsidiary of South Korea's Samsung Electronics Co Ltd said on Thursday it received approval to build a $1 billion display module assembly plant in Vietnam, its first production facility in the country.
A Samsung Display Co Ltd spokesman said the company plans to start production at the plant, to be built in Bac Ninh province, some time in 2015. Exact production capacity or types of displays to be handled at the facility have yet to be decided, he said.
Samsung Electronics has been ramping up its production capacity in Vietnam in a bid to lower production costs, amid intensifying competition in the smartphone market.
Chinese rivals like Huawei Technologies Co Ltd and Lenovo Group Ltd are mounting a particularly strong challenge in mid-to-low tier products.
Samsung Display said the Vietnam facility will improve its ability to supply displays to Samsung Electronics, which already makes mobile phones in the country.
"The work is labour intensive, so there should be tangible benefits in overall cost reduction for Samsung Electronics," HI Investment analyst Song Myung-sub said.
Samsung Electronics owns 84.8 percent of unlisted Samsung Display, according to a June regulatory filing. (Reporting by Se Young Lee; Editing by Stephen Coates)