Malcolm Owen
Trade wars are continuing to prompt Apple to rethink some of its manufacturing and supply chain options, with the iPhone maker said to be examining the situation of an ongoing tiff between South Korea and Japan, one which could lead to Apple using China's BOE for future iPhone display panels.
Japan and South Korean companies are being affected by restrictions from Japan on South Korean firms, retaliating against a Korean court ruling that Nippon Steel has to pay for using forced Korean labor during the Second World War. The restrictions, which kicked in on July 4, affects the export of chemicals used in display production from Japan to South Korea, affecting suppliers that provide components to Apple, among other firms.
In the wake of the supply disruption, Apple and other tech companies are reported by The Investor to be looking into how the restrictions are affecting their suppliers, at the same time as renewing contacts with Samsung. "They discussed the current situation with Samsung officials," industry sources told the report.
The restrictions are thought to create issue with the production of displays as well as DRAM and NAND flash memory chips, with all three core elements of practically all computing devices produced today. If the restrictions happen over a long period, supplies of the components from Samsung and others could be affected, impacting the overall production of other hardware.
As a mitigation, Apple is now considering the possibility of introducing another OLED display supplier to the roster for its iPhones. Industry sources of DigiTimes believe the Chinese display panel producer BOE Technology is a "strong contender" for OLED orders from Apple, with the ongoing trade war making the Chinese firm a far more attractive opportunity as the situation escalates.
Apple uses a number of suppliers for its displays, with the bulk of OLED stemming from Samsung with LG Display also providing some panels, while the troubled Japan Display largely handles LCD production.
BOE has invested heavily in OLED production, and has previously attempted to garner orders from Apple for the iPhone X's OLED panel. Given the situation, and the benefits of having a diverse list of component suppliers, a BOE-produced display panel in a future iPhone has the potential of happening, depending on how the Japan-Korea situation plays out.
Charles Martin
Andrew O'Hara
William Gallagher
14 Comments
Saw DigiTimes quoted, gave up and went straight to the comments.
Has anybody ever won a trade war?
"You fell victim to one of the classic blunders. The most famous of which is: never get involved in a [trade war with] Asia."
Rather than getting more in bed with China, Apple should help Japan and S. Korea sort this out, and keep diversifying the supply chain.