Demand for e-readers has picked up so much this year that production lines at AUO's partner, SiPix Imaging, are already running at full capacity, the AUO representative said. The company is working with AUO to expand production and outsource to an AUO factory in Linkou, Taiwan.

AUO, one of the world's largest makers of LCD screens, holds around a 30 percent stake in , and shares engineering work on e-reader technology and screen production with the company. The chairman of SiPix, C.T. Liu [CQ], is also the chief technology officer of AUO.

SiPix currently runs 20,000 sheets of mother glass through its production lines in Fremont, California, each month, enough to produce 200,000 6-inch e-reader screens, at 10 screens per sheet of mother glass. By October, AUO and SiPix engineers hope to increase production on that factory to 30,000 sheets of mother glass per month, for output of up to 300,000 6-inch e-reader screens.

SiPix does not expect the new output to satiate demand for e-reader screens, therefore it plans to use AUO factories in Linkou to run 70,000 additional sheets of mother glass per month by the middle of next year. The additional manufacturing capacity will put its total output at 100,000 sheets of mother glass per month, or 1 million 6-inch e-reader screens per month.

In the second half of next year, SiPix's total output should reach 300,000 sheets of mother glass per month, equivalent to 3-million 6-inch e-reader screens, the AUO representative said.