Apple has added a third manufacturer to its stable for the 2017-era iPhone 8, according to a new report.
The newcomer? Wistron, which previously gained experience as an Apple supplier on secondary iPhone handsets such as the iPhone 5s and, reportedly, the iPhone SE. It will join established Apple suppliers Foxconn and Pegatron working on the next-gen tenth birthday iPhone, which will likely launch next September.
While Wistron hasn’t commented publicly on the orders, it was recently noted that it is upping its investment in a plant based in Kunshan, China from $135 million to $200 million — and that this plant will focus on manufacturing mobile devices.
In all, Wistron is expected to generate combined revenues of $20.02 billion for 2016 (not just from Apple), with a gross margin of 5.05 percent.
Hedging its bets
If true, the move to welcome Wistron into the iPhone producing fold is no surprise — since in recent years Apple has been trying to use several different companies to manufacture each of its products as a way of lowering the risk of relying on one single supplier — while maximizing profits in the process.
Last year, there was talk that Apple had outsourced a small portion of its 4-inch iPhone SE orders to Wistron, looking to nurture the company to become an iPhone assembly house.
With the iPhone 8 likely to be Apple’s biggest upgrade since 2014’s iPhone 6 and 6 Plus — with notable improvements set to include OLED displays, an all-glass enclosure and wireless charging — it makes sense that Apple would want as many hands on deck as possible. Besides, with iPhone sales falling, adding a new supplier gives Apple additional bargaining power.
Source: Digitimes
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
2 responses to “Apple adds another manufacturer to its iPhone 8 team”
adding a new supplier gives Apple additional bargaining power??
No, wouldn’t say so.
The more you order from one single supplier the lower price-per-piece you get.
…Lowering the risk of relying on one single supplier??
No man!
Minimizing the number of suppliers gets you better quality and control over products (nothing to do with security portfolio mentioned above).
I think that are the reasons why Apple’s been working with only 2-3 big suppliers and not with like 10-15. Based on how many iPhones they sell – a dozen suppliers wouldn’t be so unrealistic at all.
But Apple can’t afford to risk their quality, that’s why they stick with 2-3 partners
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