According to BusinessKorea, LG Innotek will exit the HDI market and strategically shift labor and resources to the semiconductor business.
LG Innotek announced that it has decided to terminate the printed circuit board (PCB) business, which is an HDI business and accounts for 3.1% of the company's total sales. LG Innotek is expected to end PCB production within this year and stop selling PCBs in June next year.
LG Innotek explained that the HDI business was suspended due to declining demand for high value-added products from mobile devices and increased competition, which has led to the suspension of the business. Earlier, the company had said it was considering various plans, including exiting the HDI business to streamline its substrate business.
Analysts said LG Innotek's PCB business sales depend on brother companies, especially smartphones. This year, LG Innotek's PCB production is about 156,000, less than 30% of the annual output between 2013 and 2016, and the plant operating rate has also dropped to about 51%.
LG Innotek pointed out that after closing the PCB business, some resources will be transferred to its semiconductor substrate business, and its PCB employees will also be deployed to the semiconductor substrate business.
A LG Innotek spokesperson said, "We want to improve our portfolio by selecting and focusing on businesses that can grow and generate profit."