Sharp confirmed this week that its plan to sell the Kameyama No. 2 LCD factory in Mie Prefecture to parent company Hon Hai Precision Industry (Foxconn) has collapsed. The deal, announced in 2025 with a target closing around mid-2026, was supposed to give Sharp breathing room to restructure while handing Foxconn integrated display capacity. Instead, Foxconn reassessed the market, concluded the numbers no longer worked, and pulled out.
The implications of that decision ripple well beyond one factory in central Japan. When a parent company won’t buy its own subsidiary’s plant at what was presumably favorable pricing, the message to the rest of the industry is unambiguous: legacy LCD capacity in Japan has crossed a line where even strategic buyers with built-in synergies cannot make the math work.
Kameyama No. 2 is a Gen-8 LCD fab that historically produced small and mid-size panels for smartphones, tablets, and PCs. It was once a flagship, part of the broader Kameyama complex that symbolized Japan’s leadership in flat-panel manufacturing through the 2000s. Sharp poured billions into the site, and for a time, “Kameyama-made” was a genuine selling point for LCD quality.
That was a different era. Over the past decade, Chinese rivals, led by BOE, TCL CSOT, and HKC, ramped much larger Gen-8.5 and Gen-10.5 fabs with lower unit costs and heavy depreciation coverage, often backed by provincial and national subsidies. The pricing power that once sustained Kameyama evaporated. The plant found itself producing panels in market segments where Chinese scale players could consistently undercut on cost, and where margins had compressed to the point of irrelevance.
When the acquisition was first announced, the logic was straightforward enough. Foxconn, as the world’s largest electronics contract manufacturer, could absorb display capacity into its vertically integrated supply chain. Sharp, in turn, would shed a loss-making asset and focus its remaining resources on higher-value work. On paper, this was an insider deal with natural synergies.
But between announcement and execution, the small and mid-size LCD market deteriorated further. Panel prices softened, utilization assumptions that underpinned the deal eroded, and the competitive gap with Chinese producers continued to widen. Foxconn’s calculus shifted from “we can make this work internally” to “even at insider pricing, we don’t want more aging LCD steel in a world dominated by cheaper Chinese glass.”
That reassessment is telling. Foxconn is not a company that shies away from industrial scale or thin margins. It runs the largest iPhone assembly operations on the planet. If Foxconn looked at Kameyama No. 2 and decided the future demand and pricing environment could not support the required investment, the plant’s standalone economics were genuinely dire.
With the sale off the table, Sharp plans to halt production at Kameyama No. 2 by around August 2026. Approximately 1,100 to 1,200 jobs will be affected through voluntary retirement and redeployment. For Mie Prefecture, where the Kameyama complex has been a major employer since the early 2000s, the impact extends beyond the factory floor to suppliers, logistics firms, and local services that grew up around the plant.
Sharp is consolidating its remaining LCD operations around Kameyama No. 1, which focuses on automotive displays and higher-value specialty panels rather than commodity phone and PC screens. This is the same playbook the company applied at its Sakai Gen-10 plant in Osaka, which Sharp shuttered after years of unprofitable TV panel production. The Sakai site is now being repurposed toward data center and technology-service functions.
Together, the Sakai closure and the Kameyama No. 2 shutdown mark a near-total exit from large-scale commodity LCD manufacturing. Sharp is not leaving displays entirely, but the days when the company, or Japan more broadly, operated as a volume leader in LCD are definitively over.
Sharp’s retreat is the latest chapter in a structural realignment that has been underway for a decade. Japanese firms have been steadily exiting mass-market LCD as Chinese panel makers captured the overwhelming share of global capacity. Korean players, Samsung Display and LG Display, read the map earlier and pivoted aggressively into OLED, QD-OLED, and higher-margin IT and automotive displays. Sharp, caught between Chinese cost advantage and Korean technology leadership in next-generation panels, was left holding an aging LCD footprint in the worst possible competitive position.
TrendForce estimated that the earlier Sakai Gen-10 closure alone removed roughly 5 million TV panels per year from global supply, about 2% of the total. Kameyama No. 2 now takes another chunk of legacy Japanese capacity off the table, further concentrating global LCD production in China and, to a lesser extent, Korea.
For TV and monitor buyers, the practical consequence is continued consolidation of supply. The panel industry is moving toward a structure where virtually every commodity LCD comes from a Chinese or Korean fab. Japanese production will persist only in niches, automotive, industrial, medical, and select specialty applications, where technical requirements and qualification cycles provide some insulation from pure cost competition.
A Symbol Becomes a Cautionary Tale
The Kameyama complex was, for years, the physical embodiment of Japan’s flat-panel ambitions. Sharp built it to demonstrate that world-class LCD manufacturing could thrive in Japan, and for a while it did. The fact that the same facility is now being wound down, after even its own parent company declined to take it on, captures the full arc of how completely the competitive landscape has shifted.
Foxconn walking away is not a failure of strategy or execution in the narrow sense. It is simply an acknowledgment that the economics of legacy LCD, outside China’s cost structure, have become untenable. The display industry’s center of gravity has moved, and the remaining question for companies like Sharp is not whether to retreat from commodity panels, but how quickly and cleanly they can redeploy toward segments where they still have a defensible position.
