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Largan to set up subsidiary for car-use lens modules

Jane Wang, Taipei; Adam Hwang, DIGITIMES Asia 0

Smartphone-use lens module maker Largan Precision will establish a subsidiary for developing and producing lens modules used in automotive cameras, according to company CEO Lin En-ping.

Clients' demand for car-use lens modules is stronger than expected, prompting the company to set up the subsidiary, Largan Industrial Optics, with initial paid-in capital expected at NT$1.0 billion (US$35.7 million), Lin said.

Viewing that molded glass lens pieces are competitive for car-use lens modules, Largan plans to include production of such lens pieces at new factories under construction, Lin said.

According to industry sources, Tesla is Largan's main client for car-use lens modules and has forecast large demand for upgraded models in 2022. Largan will expand the corresponding production capacity, the sources said.

Shipments in third-quarter 2021 are mainly for 6P (six plastic lens pieces) and 7P lens modules, while shipments for 8P models to two clients were originally scheduled for the fourth quarter but are deferred until first-quarter 2022, Lin noted.

Based on orders received, consolidated revenues for August will increase sequentially and those for September will further rise, Lin indicated.

For entry-level lens modules including 6P and 7P models, there is no room for hiking prices to reflect increases in components and materials costs, and there is little room for hiking yield rates, Lin said. The only way to maintain gross margins for such products is to hike utilization of production capacity, and Largan will try its best to reach 100% utilization of the corresponding production capacity at the end of third-quarter 2021, Lin indicated.

Largan is in design-in process for combining voice coil motors (VCMs) produced by its subsidiary Largan Digital with lens modules in manufacturing process of lens modules instead of attaching VCMs to finished lens modules, Lin noted.

Largan Precision CEO Lin En-ping

Largan Precision CEO Lin En-ping
Photo: Shihmin Fu, Digitimes, August 2021