Apple Adds Suppliers to Help Boost Smartphone and Tablet Production
With a growing demand and limited production capacity, Apple is reportedly set to certify two new Asian assembly partners to boost its iPhone 5C and iPad mini supply, with at least one partner said to be ramping up production by the end of the year. Taiwan-based contract manufacturers Wistron and Compal Communications will come on board to supplement existing partners Foxconn and Pegatron, according to a report from The Wall Street Journal
. Wistron will reportedly handle iPhone 5C production while Compal will build Apple’s iPad mini.
Foxconn, which is Apple’s primary manufacturing partner with a hand in nearly every Apple product, will continue to focus on production of the significantly constrained iPhone 5S. Restricted supplies of Apple’s new flagship handset have contributed to sales shortfalls at several of Apple’s carrier partners around the world, even as the 5S and the iPhone 5C, have seen record sales overall.
As of right now, the relationship between Apple and Foxconn is said to be strained, with the paper citing labor issues, disagreement over responsibility for manufacturing defects and Foxconn’s reluctance to dedicate more resources to orders from Cupertino as primary factors. Apple is rumored to account for approximately 40% of Foxconn’s yearly revenue. Furthermore, a Foxconn executive mentioned that chairman, Terry Gou, “is not willing to cut contract prices substantially to get more orders from Apple,” and the company is “aware of the risk building gigantic production capacity for a single customer so it is adopting a more cautious stance on expanding production.”
There appears to be no word on which specific model of the iPad mini Compal will produce, though the new Retina-equipped model is widely expected to be in short supply. The issue is believed to be related to low display yields from partners Sharp and LG, rather than assembly constraints. The WSJ
also notes that Compal has reserved one of its Chinese factories for iPhone production next year, though Apple has yet to place such an order.
As of right now, we’ll have to wait and see what Apple does next.
Source: The Wall Street Journal