TOKYO (Reuters) - Japan's Matsushita Electric Industrial Co is finalizing plans to mass-produce 37-inch organic light-emitting diode TVs in three years, aiming to overtake rivals in the next-generation flat-TV race, the Sankei Shimbun daily reported on Tuesday.


The newspaper said that Matsushita would be the first to mass-produce OLED TVs of over 30 inches, and that the company aimed to challenge Samsung Electronics for the top share in the global flat-TV market.

The paper also said Matsushita would likely start selling the OLED TVs for around 150,000 yen ($1,390).

Matsushita spokesman Akira Kadota said the company was considering the commercialization of OLED TVs in the future, but it had not decided on any details including the launch timing or size.

Unlike LCDs, OLED panels do not need backlighting, making them slimmer and more energy efficient. But makers need to clear hurdles such as cutting production costs and maximizing screen size in order to begin mass-producing OLEDs.

Sony last November started selling the world's first OLED TVs with an 11-inch screen.

Matsushita President Fumio Ohtsubo said in January it would be a while before Matsushita could launch OLED TVs. Although Matsushita was planning to launch large-sized OLED TVs, demand for that type of OLED TV would probably not take off until around 2015, he said.

The Sankei report said Matsushita would start a production line exclusively for OLEDs at its new LCD panel factory that is being built in Himeji, Hyogo Prefecture, in western Japan.

Matsushita, the world's No. 1 plasma TV maker, will also set up an OLED production line at the IPS Alpha Technology factory in Chiba Prefecture, the paper said. Matsushita owns a 30 percent stake in IPS Alpha, which makes large LCD panels.

Shares of Matsushita, which will change its name to Panasonic Corp on October 1, shed 0.8 percent to 2,370 yen as of 0027 GMT, while the broader Nikkei 225 index declined 0.3 percent.

(Reporting by Sachi Izumi and Mariko Katsumura; Editing by Chris Gallagher)

© Copyright 2008 Reuters.

Photo:
Sony XEL-1 OLED TV.