Toshiba is rumored to be building a factory to manufacture high-resolution LCD displays for Apple, according to a report in the Nikkei Business Daily. The Japanese company may spend 100 billion yen ($1.9 billion USD as of this writing) to build the factory, which is expected to be ready for production in the second half of 2011. With this new plant, Toshiba will be able to double its current LCD production level, which now hovers around 8.55 million units per month. Apple is reportedly investing an unknown sum into the construction of this plant and will use it to produce Retina Displays for future iPhone models. This a switch for Apple as current iPhone models use a Retina Display manufactured by LG.
Apple's investment in a manufacturing facility to build Retina Displays is a wise move. Rival HTC struggled earlier this year with display panel shortages that affected sales of its flagship Android handset models. Both the Verizon Wireless HTC Incredible and the Sprint EVO 4G were out of stock for over a month due to LCD shortages. The manufacturer reportedly slowed production on the Nexus One and the HTC Desire as AMOLED shortages forced them to shift to a Super LCD display. By investing in a dedicated manufacturing facility, Apple would be able to secure an ample supply of display panels for its popular mobile devices. If shortages hit the overall LCD market, the effect on Apple will be minimal.
Hopefully, this rumor pans out as it would put Apple in a good position to meet the ever increasing demand for the iPhone. While Apple has not commented, Toshiba has denied the report, claiming it is has not made a commitment to produce LCD panels for Apple.