Sharp Corporation, a subsidiary of Taiwan's Foxconn, has confirmed that it will end LCD panel production at its Kameyama No. 2 factory in Mie Prefecture by August, following the failure of a planned sale of the facility. This factory, which has been operational since 2004, primarily produces small and medium-sized LCD panels for smartphones. The company is now looking to recruit about 1,570 employees for voluntary retirement as part of its structural reform efforts, which are expected to incur costs of approximately 14.9 billion yen.

The decision to halt operations at the Kameyama No. 2 factory stems from a significant deterioration in profitability, leading to the announcement of its planned sale to Foxconn in May 2025. However, Sharp's president Masahiro Okitsu explained that the sale could not proceed due to the lack of benefits for Foxconn in terms of future demand and pricing trends. Despite the shutdown of LCD production, there are plans to continue server production for artificial intelligence (AI) at another facility in Kameyama that remains open.

These developments reflect broader challenges in the electronics manufacturing sector, particularly regarding LCD technology, which has faced declining demand and increased competition. As Sharp pivots to potentially more profitable ventures, including AI servers, the move also underscores the ongoing transformation in production strategies, as the company seeks to navigate the rapidly changing technology landscape and the imperative for efficiency in its operations.