Tokyo and Washington are considering building a screen factory in the United States in partnership with Japan Display, as part of a $550 billion investment program planned by Japan, two sources familiar with the matter said on Monday.
The project aims to strengthen American screen production, as Washington is concerned about China’s dominance in display technologies used in military systems, and fierce price competition has pushed most Japanese manufacturers out of the market.
Japan Display declined to comment. Its shares surged 80% on Monday, valuing the long-struggling company at 190 billion yen ($1.2 billion).
The news was first reported by Nikkei Asia, which said the project is expected to be worth around $13 billion.
The screen project is part of several ongoing agreements being discussed between the United States and Japan, according to one of the sources, who declined to be identified.
Reuters reported that the two parties are also working on including a nuclear energy project involving Westinghouse in a second set of agreements that are part of the investment commitments Tokyo made in its tariff agreement with the United States.
Japan Display, established in 2012 from the government-backed merger of the display units of Sony Group, Toshiba, and Hitachi, was once one of the world’s leading suppliers of liquid crystal display (LCD) panels and the main supplier of screens for Apple’s iPhones.
However, Apple’s transition to organic light-emitting diode (OLED) screens, combined with Chinese price competition, has left Japan Display with losses for over a decade.
The company is consolidating its domestic factories to focus its resources on automotive screens and is discontinuing OLED panel production for the Apple Watch.
The Japanese government invested over 460 billion yen in Japan Display but withdrew support last year, losing around a third of its investment.
Research firm Counterpoint predicts that China will continue to dominate global display capacity, with its share increasing from 68% in 2023 to 75% in 2028.
(1 $ = 158.6500 yen)
