Looks like the global semiconductor crunch has finally hit Apple. As per a report by Nikkei Asia, the production of some MacBooks and iPads has been delayed owing to the worldwide chip shortage that has put the automobile as well as consumer electronics industry under severe stress. As the demand has shot up and continues to outweigh the supply, Apple faces a tough task ahead as the company prepares a highly anticipated slate of products that includes redesigned Macs with in-house silicon, upgraded iPad Pro models with a new display technology, and of course, the upcoming iPhone 13 family.
“Chip shortages have caused delays in a key step in MacBook production — the mounting of components on printed circuit boards before final assembly — sources briefed on the matter told Nikkei Asia. Some iPad assembly, meanwhile, was postponed because of a shortage of displays and display components, sources said.
As a result of the delay, Apple has pushed back a portion of component orders for the two devices from the first half of this year to the second half, the people said.”
As per the publication’s sources, the production of iPads has also been postponed due to the shortage of displays and display components. In MacBook’s production, the step of mounting the components on printed circuit boards just before the final assembly is being affected. Hence, Apple is now pushing back a part of its component orders for both products from the first half of this year to the second half.
However, it is unclear if the production delay concerns only iPad and Macbook models that are already on the shelves, or if the semiconductor shortage has also affected the production of the yet-to-be-launched models too. And even though the production of iPhones has not been hit, the report mentions that the supply of some components is ‘quite tight.’ As per a Bloomberg report from earlier this month, ‘the tightened supply of Qualcomm AP chips produced by TSMC is affecting everybody except Apple.’
Apple is known to have a solid supply chain control mechanism, and also commands a ‘priority client’ status. And that means it is among the few big brands with the luxury of a steady component supply while smaller names are hit by upheaval in the notoriously complex semiconductor industry. Foxconn, Apple’s key manufacturing partner, revealed earlier in March that its shipments will reduce by 10% due to the global chip shortage.
Industry sources believe that delays are a sign that the chip shortage is growing more serious, which could in turn, impact smaller tech firms even more adversely. So far, the production of iPhones has not been affected by the supply shortage. The report goes on to say that the component shortage remains a supply chain issue for Apple, but it hasn’t yet had an impact on product availability for consumers.
“We really don’t see an end to this shortage, and things could be even worse, looking ahead to the end of the June quarter, as some smaller tech players could run out of some critical inventories to build their products and need to scale back production,” said Wallace Gou, president and CEO of Silicon Motion, a NAND flash memory controller chip developer that supplies Samsung, Western Digital, Micron, Kingston and many others. If you’re looking for an in-depth take on the ongoing semiconductor crunch and how it is affecting everything from phones to cars, read this excellent Bloomberg explanation.
(Nadeem Sarwar contributed to this article.)