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Apple looks to expand iOS device supply chain beyond Foxconn, Pegatron in 2014

post #1 of 11
Thread Starter 
In the coming year, Apple could greatly diversify its supply chain beyond current partner manufacturer Foxconn, says one analyst, with the Cupertino company looking to other Taiwanese firms to build iPhones, iPads and iPods.

iPhone


In a note provided to AppleInsider, well-connected KGI analyst Ming-Chi Kuo said he expects Apple to continue to diversify its suppliers, an initiative most clearly seen by the company's move away from rival smartphone maker Samsung.

Kuo believes top candidates include Taiwan's Compal Communications, which has experience in both designing and manufacturing handsets for Nokia, Sony and Lenovo; Wistron, an established supplier of EMS services to RIM (now BlackBerry); and Inventec Appliances, a firm that is currently an iPod suppler. Both Compal and Wistron will be new entrants into Apple's supply chain, while Inventec would expand its contracts beyond the iPod.

While the production companies are set to see a boost in profits from expected contract orders, Kuo sees Apple as the biggest winner, as its bargaining power and shipment stability will strngthen.

With the diversification, Apple's current go-to partner manufacturers, Foxconn and Pegatron, will likely be negatively impacted. The latter is thought to be a major player in Apple's upcoming iPhone product line refresh, and could handle up to 75 percent of production for the so-called "iPhone Lite."

"If Hon Hai and Pegatron struggle to increase new iOS orders or high-end product exposure, we think their days of rapid growth, driven by Apple, could be at an end," Kuo writes.

Apple in May was reportedly looking to shift its supply chain away from Foxconn in favor of Pegatron, another major supplier for iOS products. The move was supposedly meant to nullify risk associated with Foxconn, which in 2012 shipped iPhone 5 units with nicks and scratches.
post #2 of 11

Smart! :)

post #3 of 11
Spread the wealth. Away from Samsung.
Edited by SockRolid - 7/11/13 at 1:40pm

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post #4 of 11
I'm perplexed. Aren't there any Korean manufacturers Apple might address. mmmm, I'll have to chew on that one a while. 1wink.gif

When I find time to rewrite the laws of Physics, there'll Finally be some changes made round here!

I am not crazy! Three out of five court appointed psychiatrists said so.

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When I find time to rewrite the laws of Physics, there'll Finally be some changes made round here!

I am not crazy! Three out of five court appointed psychiatrists said so.

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post #5 of 11
Wish there were some way Apple could set up a factory in Mexico. Could straddle the border with Apple offices in the U.S. end of the building and the new company in Mexico at the other end. Pay the Border Patrol to have a private internal "crossing point" to ensure no hanky-panky. Lower wages, less shipping cost, yadda yadda. I know, some components have to be shipped in, but can't help wondering if Apple might be better off in the long run.
A.k.a. AppleHead on other forums.
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A.k.a. AppleHead on other forums.
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post #6 of 11
I think you should diversity as much of everything as possible. But not so much that it hurts quality of the product. All apples products should be as identical as possible.
post #7 of 11
Why would apple finally not build the plants to make there products?
post #8 of 11
Interesting but I could see Foxconn becoming a different sort of partner for Apple. For example Foxconn could start marketing its own brand labeled Thunderbolt devices. Beyond that if Apple stays in Taiwan it really isn't the sort of diversification they really need as a world wide vendor of electronic parts.
post #9 of 11
Quote:
Originally Posted by Robin Huber View Post

Wish there were some way Apple could set up a factory in Mexico. Could straddle the border with Apple offices in the U.S. end of the building and the new company in Mexico at the other end. Pay the Border Patrol to have a private internal "crossing point" to ensure no hanky-panky. Lower wages, less shipping cost, yadda yadda. I know, some components have to be shipped in, but can't help wondering if Apple might be better off in the long run.

Mexico is still a mess of corruption and drug dealing. Even if Apple could avoid that the border area leaves a lot to be desired for setting up a business in Mexico, I might suggest that you would want to get far away from the border area if you go to Mexico. There are simply better more stable areas in the country that might actually support a business like Apple would need to setup. Still the horrors stories about setting up businesses in Mexico are still pretty bad, you would be far better off going farther south.

How far south. Brazil! Seriously a much more interesting country and frankly a more interesting people. More importantly they are driven to succeed and really want their country to be a success. There are actually a few places in between that aren't too bad also.
post #10 of 11
Quote:
Originally Posted by ny3ranger View Post

I think you should diversity as much of everything as possible. But not so much that it hurts quality of the product. All apples products should be as identical as possible.

This is likely a major concern for every decision Apple makes in this realm. However a good portion of the quality of every Apple product is in its design which Apple is directly responsible for.
post #11 of 11
Quote:
Originally Posted by wizard69 View Post

. . .
Seriously a much more interesting country and frankly a more interesting people. . . .

How the hell can you say something like that? Never mind, I know how you could.
Edited by Flaneur - 7/11/13 at 7:03pm
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