Sharp is dedicating an entire LCD plant to Apple

sharp-igzo-panel-ipad-648x423

iPad screenmaker Sharp is allocating a major chunk of its LCD production facilities to Apple — but doesn’t seem all that happy about it.

According to an interview published Monday with Sharp Senior Executive Managing Officer Norikazu Hoshi, the company worries about what it means for the entire output of the Japanese display maker’s Kameyama No. 1 plant to go “to just one company (Apple).”

As Hoshi phrases it, this reliance on Apple is a less than financially sound decision.

“If you look at just this plant, it certainly presents a high level of volatility risk,” Hoshi says. “But if we make LCD panels for smartphones in large quantities at the No. 2 plant, we can absorb the impact even when the No. 1 plant is not doing so well.”

Hoshi says that Sharp’s No. 1 plant uses sixth-generation glass substrate, while the company’s No.2 plant is based on a more advanced eighth-generation substrate.

While this does sound ungrateful to Apple, which is handing a struggling company a whole lot of business, it does reflect something of a theme when it comes to Apple suppliers. Because of Apple’s constantly changing requirements (based on its shifting product line), having Apple as a customer results in big changes in production quantities from quarter to quarter. Add that to worries about tying your fortunes to Apple’s, at a time when Android devices are munching up a lot of the lower-end of the market, and it’s no wonder a few companies would get squeamish.

Especially since Sharp rival Japan Display has been handed the job of supplying screens for the iPhone 6. Hmm… perhaps there’s a not-so-subtle hint hidden in Norikazu Hoshi’s interview?

  • Adrayven

    Apple has handed Sharp production jobs before and had to be pulled as a supplier because they couldn’t or wouldn’t fulfill demand.. They should be happy Apple is giving them another chance. Only real reason Apple is doing this is they want away from Samsung.. Only so many large display suppliers in the market to work with..

  • AAPL_@_$101_Is_A_Done_Deal_:)

    I just hope Sharp doesn’t make a mess with reject components. Apple will get hung out to dry if the news media finds something wrong with those displays.

  • Snorre Milde

    Sharp was near bankrupcy not very long ago. They should just be happy their IGZO gamble paid off.

  • blenheimorange

    Nikkei has never been a reliable source of Apple information in recent years. Wouldn’t trust it but I note the spin.

  • AlanAudio

    Apple is certainly a very demanding customer, but they buy screens in truly immense quantities. Norikazu Hoshi needs to carefully consider whether he would rather have big orders or a quiet life. It’s unlikely that he could have both.

About the author

Luke DormehlLuke Dormehl is a UK-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Formula: How Algorithms Solve All Our Problems, And Create More and The Apple Revolution, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme, and other publications. He'd like you a lot if you followed him on Twitter.

(sorry, you need Javascript to see this e-mail address)| Read more posts by .

Posted in News | Tagged: , , |