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Apple cuts Foxconn supply chain

31 May 13

Apple have added Pegatron to it's manufacturing list, as the company lowers the risk of relying too heavily on one producer.

Shifting the work away from primary manufacturer Foxconn, industry experts say the move will offer the company a greater supply-chain balance.

After dominating production of iPhones, iPads and other Apple products, Foxconn's smaller rival looks set to take charge of the budget iPhone delivery, expected later this year.

Pegatron, which nails 60% of its annual revenue from Apple, started producing iPad Minis during 2012, with Foxconn responsible for larger company products.

But unsurprisingly, the move is seen as a risk management strategy from the Cupertino firm, designed to expand product production going forward.

And history will say this is a wise move from CEO Tim Cook, as Foxconn has endured a turbulent few weeks in charge of Apple products.

The company was once again under the spotlight in April, with Apple allegedly returning eight million faulty iPhones.

Allegedly costing the Chinese company US$1.6 billion, Apple sent back the products “due to appearance of substandard or dysfunctional problems.”

Yet the company has recently increased recruitment efforts, believed to be in preparation for the launch of the new iPhone later this year, despite previously coming under criticism for hiring underage workers and fighting worker strikes.

Is Apple wise to broaden its production fleet? Tell us your thoughts below

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