An unnamed Taiwanese manufacturer has backed away from a supply agreement with Apple to provide machinery for the production of flexible printed circuit boards, The Korea Herald reports from industry sources.
Why is Infinite Loop buying up such machinery in the first place? The rumor mill take is that it needs more of these RFPCBs among other parts such as chips and OLED displays for the resource-straining iPhone 8 and has invested tens of millions of dollars in getting the machines. As it has no production facilities of its own, it is reportedly leasing the machinery to three partner manufacturers to bulk up their operations.
Interflex and Youngpoong of South Korea are said to have taken the deal. The Taiwanese manufacturer may have declined because the lease had yield quality and timeline strings attached and it wouldn’t have gotten much profit out of it. Apple is said to be looking for another South Korea firm to fill the gap.
There’s latent resistance where Apple is struggling to round up components by the lot from suppliers. But Apple acting as a broker for equipment on its onerous terms may have added to the gradient, as steep as it was already.
Apple is also said to be struggling on software development for new hardware components for the iPhone 8.