The proposed facility would form part of Japan’s broader $550 billion investment package aimed at strengthening economic and technological cooperation with Washington.
The initiative is designed to bolster American display manufacturing capacity amid growing concerns in Washington about heavy reliance on Chinese suppliers for critical display technologies used in defence and military systems.
Strategic technology push
Sources said the display project—reported by Nikkei Asia to be worth roughly $13 billion—is one of several investment proposals currently under discussion between the two allies.
The planned investment comes at a time when intense price competition in the global display market has pushed many Japanese manufacturers out of the sector, allowing Chinese companies to dominate production.
Research firm Counterpoint Research projects that China’s share of global display manufacturing capacity could increase from 68 per cent in 2023 to about 75 per cent by 2028.
Japan Display shares surge
News of the potential project triggered a sharp rally in Japan Display’s stock, with shares surging nearly 80 per cent on Monday. The jump valued the company at around 190 billion yen, or roughly $1.2 billion.
The company declined to comment on the proposed project.
Part of broader U.S.–Japan investment deals
According to one of the sources, the display plant is among several initiatives being negotiated as part of investment commitments Japan made under a recent tariff agreement with the United States.
Previous reports by Reuters indicated that another possible project under consideration involves nuclear energy cooperation with Westinghouse Electric Company.
A company seeking revival
Japan Display was created in 2012 through a government-backed merger of the display divisions of Sony Group, Toshiba and Hitachi.
The firm once ranked among the world’s leading suppliers of liquid crystal display (LCD) panels and served as a major screen supplier for iPhones produced by Apple.
However, Apple’s transition to Organic Light-Emitting Diode (OLED) displays, combined with aggressive pricing by Chinese manufacturers, has left Japan Display struggling with financial losses for more than a decade.
In response, the company has been restructuring its operations, consolidating domestic production facilities and shifting focus toward automotive display technology. It has also announced plans to end OLED panel production for the Apple Watch.
Government exit
The Japanese government previously invested more than 460 billion yen in Japan Display to support the company’s survival. However, it exited its stake last year, reportedly losing about one-third of its investment.
Industry analysts say the proposed U.S. factory could provide Japan Display with a strategic opportunity to regain relevance in the global display supply chain while helping Washington diversify critical technology manufacturing away from China.