TOKYO — Sharp will ramp monthly LCD capacity at its Kameyama No.1 fab to 60,000 substrates in March following an investment of ¥15 billion (about $130 million).

The move, which increases substrate capacity at the fab by by 9,000 per month, comes as Sharp's market share in LDC TVs has taken a hit, squeezed by capacity constraints. Market researcher DisplaySearch said in its most recent quarterly LCD TV survey that Sharp fell from the top spot to No.3 on a unit basis and from first to second place on a revenue basis.

DisplaySearch also noted that the fourth quarter of 2005 was the first in which Sharp did not hold the top spot worldwide in LCD TV unit sales and revenue since the inception of the LCD market. DisplaySearch said a lack of capacity and insufficient external sourcing had prevented Sharp from keeping pace with market demand.

Sharp remained the top supplier in Japan on a unit basis, but it fell from second to third in North America and from third to fifth in Europe. It dropped from first to fourth place in the market for panels ranging from 30 to 34 inches, though it remained the leader in other size ranges, according to DisplaySearch.

Sharp president Katsuhiko Machida acknowledged earlier this year that its capacity had not kept pace with the rapidly growing market. The result has been declining market share and accelerated expansion plans.

Sharp's Kameyama No. 1 fab is its sixth-generation LCD facility for 1,500 x 1,800-mm glass substrates, which yield either eight 32-inch panels or six 37-inch panels. Three 45- or two 65-inch panels could also be produced, but Sharp is apparently focusing on efficient sizes to increase volume.

Sharp will continue to contend with materials shortages until the Kameyama No. 2 fab begins operations in October. That plant will be the world's first eighth-generation fab and will handle 2,160 x 2,400-mm glass substrates, yielding either eight 40-inch or six 50-inch panels.

Kameyama No.2 will launch operations with a monthly capacity of 15,000 substrates. Sharp said it will double capacity by March 2007, almost nine months earlier than originally planned.

"Demand for larger-sized screens is rapidly growing in the LCD market. The No. 2 fab can supply large-sized panels [over 40-inch] efficiently," said a Sharp spokesman.

Sharp has been looking for an external source of LCD panels for TVs and expects to select a partner by the end of March.