July 27 (Bloomberg) -- Sharp Corp., Japan's largest maker of liquid-crystal display televisions, forecast average industry prices of large models will fall about 25 percent this year as competition increases.

``The price of LCD TVs in the 40-inch category, currently about $2,600 to $2,700, will fall to less than $2,000 by the end of this year,'' Toshihiko Hirobe, deputy general manager of Osaka-based Sharp's large-sized LCD TV business, said today. Prices for 30-inch models are ``hitting bottom,'' he said, without providing further details.

Sharp this week reported first-quarter profit rose 1.4 percent on sales of its Aquos televisions, joining rivals Samsung Electronics Co. and LG.Philips LCD Co. in reporting higher earnings. Shipments of LCD TVs will outpace plasma models, such as those made by Matsushita Electric Industrial Co., by five to one this year, according to Lehman Brothers Holdings Inc.

``In Japan, the competition is almost over, with the LCD industry the winner,'' Hirobe said in Kameyama, central Japan, where the company's newest factory is located. ``In the U.S., full high-definition LCD TVs will gain a big market share and there will be no room for plasma TVs.''

Matsushita Electric Chairman Kunio Nakamura said he wasn't ``worried'' about price declines for flat-screen televisions.

The company, the world's largest maker of plasma TVs, focuses on models with 50-inch or bigger screens to weather price declines. He spoke in an interview in Shizuoka, where Japan's Keidanren business lobby is holding a two-day forum.

LCD TV shipments may surge 76 percent to 74 million units this year, while shipments of plasma TV sets will probably rise 30 percent to 13 million units, according to Lehman.

Plasma Prices

Matsushita on July 25 said quarterly sales of its plasma televisions fell for the first time in the three months ended June 30 because of a 29 percent drop in prices.

The Osaka-based company said net income climbed 9.7 percent to 39.3 billion yen ($330 million) in the fiscal first quarter, as a weaker yen bolstered sales of its Viera flat-panel televisions and Lumix cameras.

Average LCD TV prices at Sharp rose 4 percent in the last quarter after the company focused on larger-sized TV sets, as industry prices fell about 30 percent, Tetsuo Onishi, an executive in charge of accounting, said July 25, when the company reported earnings.

In April, Sharp President Mikio Katayama said the company plans to build a new LCD-making plant, with details on the size of investment, location and timing of construction to be announced by ``summer.''

Details on the timing and exact location haven't been decided, Hirobe said today during a factory tour for foreign journalists. The company doesn't plan to build an overseas plant to make LCD panels for TVs, he said.

``Japan is the best location to have cooperation between panel makers and suppliers of materials and equipment,'' he said.

To contact the reporter on this story: Hiroshi Suzuki in Tokyo at hsuzuki5@bloomberg.net

Last Updated: July 27, 2007 05:43 EDT