Apple reportedly squeezing 'iPhone 7' parts suppliers for better pricing

New supply chain reports suggest that Apple is putting pressure on Taiwan-based part suppliers to lower prices for "iPhone 7" components, despite reportedly ordering lower quantities.

In an editorial published by supply chain monitor DigiTimes, Apple is said to be seeking price points for components similar to prices from China mainland-based parts suppliers. The companies are said to be resisting, citing a lack of sufficient profit if they meet Apple's demands.

Apple is said to be seeking as much as a 20 percent cut in pricing. Order volumes are claimed to be 30 percent lower from the Taiwan suppliers than previously placed for construction of the iPhone 6s family of devices last year.

The report also claims that Taiwan Semiconductor Manufacturing company (TSMC), and Largan Precision are excluded from the demands.

TSMC is said to be Apple's exclusive "A10" chip foundry for the "iPhone 7." Largan Precision has historically supplied camera modules for the iPhone.

Digitimes has a spotty track record of picking out Apple product specifics. However, the venue has a good handle on the overall supply chain, useful for sussing out trends and larger industry factors, like this alleged supply chain demand.

The "iPhone 7" in question is expected to debut in an event in early September. Besides just excising the analog headphone jack, differences between the new model and the iPhone 6 family include camera improvements, enhanced fast charging capability, and a base 32GB of device storage.

53 Comments

schlack 727 comments · 11 Years

About 8 years ago

hoping apple releases iPhones in a rainbow of colors this time around...gotta do something to get people to upgrade to a device that largely looks the same as their existing device. /notsarcasm

gatorguy 24603 comments · 13 Years

sog35 said:

So iPhone7 sales will be down 30%

got it

I notice you aren't complaining about Apple perhaps "squeezing suppliers" to the point they see little profit if they comply just so that Apple themselves can become even richer. You displayed a different attitude yesterday about Uber squeezing their suppliers (the drivers) so that Uber could increase their margins. Yesterday you called it greed. What is it today? (not that I agreed with your views yesterday to begin with)

Templeton 84 comments · 8 Years

Next one will be THE ONE.

AI_lias 436 comments · 8 Years

sog35 said:

I still don't get why Apple did not do some kind of design change for iPhone7.

I'm sorry but moving the antenna lines is not enough.

People say design don't matter. But it does. People don't want to buy a phone that looks EXACTLY like a 3 year old phone (iPhone6)

I myself am disappointed that they did not change the design to make it less slippery. I mean, it's practically unusable without a case. Who cares about the antenna lines (which were horrible to begin with [if anyone other than Apple would have used those antenna lines you would not hear the end of it on this forum]) if you need to put it in a case anyway. Slippery as a fish. Put some sharp edges back on it, like a slab phone had. Unfortunately, I'm afraid even next year's glass phone will be just as slippery, and have glass on both sides.

mike1 3431 comments · 10 Years

Shouldn't every business squeeze every supplier, every time?
TSMC and Largan are probably excluded because they've already reached agreements and signed deals.

Apple has long worked to diversify their supplier base. This would result in few orders for legacy suppliers and is not necessarily indicative of fewer phones being sold.