LG Innotek said on Monday that it will spend 1.3 trillion won at its facility in Haiphong, Vietnam to build an additional camera module production line.
The funds will be spent up to December 2025. The City of Haiphong will install additional electrical substations and offer tax benefits to the facility, LG Innotek said.
The new production line is expected to be completed in the second half of 2024 with mass production beginning in 2025.
The new line will double LG Innotek’s camera module production capacity at its facility in Vietnam, which currently accounts for 30% of the South Korean component maker’s total camera module output. Its factories at Gumi and Paju in South Korea account for 70%.
The move is likely aimed to meet the demand for camera modules from Apple in iPhones. LG Innotek is the main supplier of the components to Cupertino.
Manufacturing camera modules in Vietnam over South Korea has a cost advantage.
LG Innotek is likely to expand its production capacity through the Southeast Asian country to better compete with Chinese rival Cowell Optic Electronics, which has facilities in China that allow it to offer competitive products.
Cowell is also looking to supply more camera modules to Apple. It mostly supplies modules for the front camera but is also aiming to supply those for the back camera, which are more lucrative.
Meanwhile, LG Innotek is seeing its supply of camera modules for high-end iPhones increase as its main rival Sharp is being pushed out of Apple’s camera module supply chain due to various setbacks.
