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Apple shifts production from Foxconn to Pegatron

Could be preparing for a budget iPhone
Fri May 31 2013, 10:16

GADGET DESIGNER Apple reportedly is shifting primary production of its shiny toys from electronics assembler Foxconn to competitor Pegatron.

According to a report at the Wall Street Journal, the move is believed to have been made so Pegatron - which is an Apple partner and already makes some iPhones and iPad Minis - can begin assembling a low-cost "budget" iPhone expected to be unveiled later this year.

Despite Apple's long term relationship with Foxconn, the Wall Street Journal claims CEO Tim Cook wants to achieve greater balance in the company's supply chain by diversifying its suppliers.

It is reported that Apple's shift to Pegatron is partly due to production troubles encountered by Foxconn while assembling the iPhone 5. Due to the device's thinner design than the iPhone 4S, Foxconn reportedly admitted last year that it had run into supply issues, with an executive quoted as saying the handset was "the most difficult device that Foxconn has ever assembled".

Another supporting factor in the rumours of budget iPhone production is that Pegatron is presently hiring a lot of workers, with plans to beef up its workforce in China by up to 40 percent during the second half of the year.

It is widely rumoured that the cheaper iPhone will go into trial production sometime next month, though it's likely that we won't see the budget Apple phone until late this year.

The iPhone 5S/iPhone6, however, is expected to appear much sooner, so see our rumour round-up for guesses and speculation.

Earlier this month, it was reported that Mozilla will collaborate with Foxconn to produce a device running its Firefox operating system. Foxconn reportedly said it wants to diversify away from over-reliance on Apple, and is expected to announce the collaboration with Mozilla on the eve of Computex. µ


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