Sharp has began construction of a factory that will be capable of handling the largest-ever sheets of glass used to make LCD (liquid crystal display) panels, it said.

The Osaka-based company is investing YEN 150 billion (AUD$1.79 billion) on the factory in Kameyama in Western Japan, and which will start producing glass panels in October 2006 using so-called 8G (eighth-generation) manufacturing technology.

The process means that the factory can handle glass sheets measuring 216 centimeters by 240 centimeters. A single sheet of glass that size can produce eight panels measuring 40 inches to 49 inches diagonally, or six panels of 50 inches or bigger diagonally, the company said.

The factory will mainly be used to produce panels for LCD TVs that are 40-inches diagonally or bigger, according to Tetsuya Igarashi, a spokesman for Sharp in Tokyo.

Cutting more panels from larger sheets of glass costs less than using several smaller sheets to produce the same number of panels. This means that the new factory will be much more efficient than the company's present production lines, which make smaller sheets of glass, Igarashi said.

The new factory will start production at 15,000 sheets per month in October 2006. Production will double to 30,000 sheets each month in 2007 after completion of a second line, the company said.