Apple has reportedly invested tens of millions of dollars in equipment for producing rigid-flexible printed circuit boards (RFPCBs) for its upcoming iPhone, claims a new report.
Although Apple typically contracts third parties to produce its products, rather than building them itself, it was allegedly pushed into making the investment after one of Apple’s RFPCB suppliers backed out at the last minute.
“One of the three suppliers recently decided to back out,” a source told ET News, claiming that it was set to be a Taiwanese manufacturer. The reason the supplier backed out isn’t entirely clear, but is supposedly related to the demanding production and quality requirements Apple pushed — alongside low profitability.
To make up the difference in PCB components, Apple decided to buy the necessary equipment and then lease it to the remaining suppliers so that they could fulfill the orders. In the meantime, Apple will search for a third supplier. The two companies continuing to manufacture the parts are reportedly Korea’s Interflex and Youngpoong Electronics.
“To fill the loss, Apple is supporting the other two suppliers, both Korean, to beef up production,” said the source.
This year, Apple is expected to order in the vicinity of 100 million RFPCB units.
Challenges along the way
Apple has reportedly run into a number of challenges while developing its most significant iPhone upgrade since 2014’s iPhone 6 and 6 Plus handsets.
Earlier this year, it was reported that manufacturers hit roadblocks relating to the handsets’ display, wireless charging and printed circuit boards. More recently, it was claimed that Apple is having problems related to the OLED panels it plans to use for the iPhone 8.
Whether these challenges conspire to delay the iPhone 8 remains to be seen. If there is truth to these rumors, however, then these headaches will certainly mean that Apple has earned whatever sales it achieves with its tenth-anniverary iPhone launch.
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