AU, Chunghwa Picture cut back LCD investment -paper

TAIPEI, Jan 30 (Reuters) - Taiwan LCD makers AU Optronics Corp. (2409.TW) and Chunghwa Picture Tubes Ltd. (2475.TW) have decided to cut back their investment in new plants on the island amid weak global demand, a local newspaper said on Tuesday. AU (AUO.N), Taiwan's No.1 and the world's No.3 LCD maker, would pare back original plans for T$400 billion (US$12 billion) in investment to T$254 billion, the Economic Daily News reported, without citing sources.

Chunghwa Picture, Taiwan's third-largest LCD maker, would now build two new-generation LCD factories, instead of the originally planned four plants in central Taiwan, the Chinese-language newspaper said, without giving investment figures.

Company officials were not immediately available for comment.

The report came before AU posts its fourth-quarter earnings next week. Analysts say the result could be weaker from a year ago after prices of liquid crystal display (LCD) panels sagged, but cheaper prices are stimulating fresh demand.

Larger rival, South Korea's LG.Philips LCD Co. Ltd. (034220.KS), reported a third straight quarterly loss as weak panel prices and lingering cost problems outweighed seasonally strong demand.

In early trade in Taipei, shares of AU were off 0.46 percent at T$43.45 and those of Chunghwa Picture were flat at T$6.40, against a 0.07 percent drop on the main TAIEX index .

(US$1=T$32.9)

((Reporting by Baker Li, editing by Rachael Barker; baker.li@reuters.com; Reuters Messaging: baker.li.reuters.com@reuters.net; +886 2 2508-0815)) Keywords: AU LCD/INVESTMENT

(C) Reuters 2007. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nTP28916