Apple, along with the rest of the Western companies that depend on China for the production and procurement of essential semiconductors, is fully aware of the effects of the lockdown measures that have blocked the activity of large industrial centers. But the real problems could only arise from now on.
Apple has hoped that Chinese supplier BOE will deliver at least 40 million screens this year, allowing it to meet at least the iPhone’s minimum production forecasts. Going beyond the fact that the partners responsible for assembling Apple products are still being kept in touch by anti-pandemic measures, it seems that production will be irreversibly upset by the lack of essential components.
Symptomatic of the cascading effects on supply chains, the BOE screen maker has reportedly already informed Apple that it will only be able to deliver 30 million units of the screen order received, but not through no fault of its own. That would be the problem also the semiconductor crisis, brought back today under the effects of the new pandemic measures. Specifically, the image processor that should be applied to the screen mode, an essential and quite complex semiconductor, would be available only at most in the above mentioned limit, presented anyway in an optimistic evaluation.
The good news is that BOE is not the only supplier of screens for Apple, the list being completed by Samsung and LG. Both have consistent production capabilities, but the reason Apple turned to a third-party vendor from the start is that the first two could not cover the huge need for screens. Under these conditions, it is unlikely that the shortage of screens could be covered by other sources, with Apple’s efforts to achieve production targets becoming increasingly difficult in the near future.
But since the BOE is not just a supplier of screens to Apple, it is likely that the problems will spread to other players in the industry, with effects on stocks of finished products and possibly store prices.
Source: Go4IT by www.go4it.ro.
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