FOXCONN is exploring the sale of its new US$8.8 billion display panel factory in China, Reuters quoted sources as saying yesterday, as demand for the product wanes amid trade tensions.

Foxconn, formally known as Hon Hai Precision Industry, is in talks to appoint banks to find a buyer for its liquid crystal display (LCD) factory that is being built in Guangzhou, two sources with direct knowledge of the matter was quoted as saying.

Foxconn’s discussions are at an initial stage and it has not yet come up with a price tag for the so-called Gen-10.5 facility specializing in large-screen LCDs, the sources said, adding a sale was not a surety.

“It’s not an easy sale and it could take a while,” said one of the sources, citing tepid global demand for large-screen LCDs.

The Sino-U.S. trade tensions have disrupted technology global supply chains in a major way, forcing Foxconn to review its own. That and slowing demand for large-screen televisions and monitors had prompted Foxconn’s management to seek a buyer for the LCD plant, one of the sources familiar with the management’s thinking said.

Questions were also being raised within Foxconn on the need for the Guangzhou project. “Existing plants are already not running at full capacity ... why need another one?” the source said.

The second source said the new factory would not go into production until early October, which makes it less appealing for buyers because of the additional risks as compared to an already operating plant.

The Nikkei daily reported earlier this year that the company would delay most of its planned production in Guangzhou for a minimum of six months, but Foxconn said the project was on schedule.

Dubbed the largest single investment ever in the city by media, Foxconn announced the Guangzhou plant in 2016, hoping to start operations by 2019.(SD-Agencies)