According to a few sources, Apple Inc. is expected to reduce its awaited iPhone 13 production for 2021 by up to 10 million units due to determined chip shortages concerning its flagship device. The company had intended to manufacture 90 million new iPhone models in the final three months of the year, but now it tells the manufacturing partners that the total products will be lower because Broadcom Inc. and Texas Instruments Inc. are striving to deliver enough components.
This huge company is one of the world’s top chip purchasers, and it establishes the chain of the electronics supply chain. Nonetheless, even with its enormous purchasing power, Apple is dealing with the same supply interruptions that have caused issues in all sectors over the world. Major chipmakers have warned that demand would continue to exceed supply for the rest of the year and maybe next year too.
Texas Instruments supplies display components to Apple, whereas Broadcom has been a huge provider of wireless components. One TI chip that is not available for the newest iPhones is connected to the OLED display. Apple is also dealing with component shortages from other vendors.
After the news was published, Apple shares fell as much as 1.6 percent to $139.27. Through Tuesday’s closing, the stock had gained 6.6 percent this year. Broadcom and TI also had dealings even after-hours trade.
Apple’s capability to provide new models to users has already been stopped by the shortages. The iPhone 13 Pro and iPhone 13 Pro Max went on sale in September, however, purchases placed through Apple’s website will not be delivered for nearly a month. The new gadgets are also labeled as “currently unavailable” for pickup at many company’s retail locations. Similar supply delays are being encountered by Apple’s carrier partners.
Apple warned earlier this year that it would face supply difficulties for the iPhone and iPad during the September quarter. At the time, the Cupertino, California-based firm said about worldwide chip shortages. That time period includes around a week and a half of iPhone 13 income.
Broadcom does not have its own large facilities and instead depends on small contract-based chipmakers such as Taiwan Semiconductor Manufacturing Co. to manufacture its products. Texas Instruments manufactures certain chips in-house but also outsources others.
As a result, they are a part of an increasingly difficult struggle to obtain manufacturing quantity at TSMC and other foundries. Apple is a TSMC customer, it is the company’s largest consumer. Apple hires the company to build its A-series CPUs, but not to disappear at the required time. The US Department of Commerce has asked global chipmakers to respond to the questions asked by November 8. This is to help in the chain supply, but legislators and businessmen in Taiwan and South Korea are opposing this action.
Separately, a huge energy crisis in China may be problematic to Apple. A few days ago, TPK Holding Co., an Apple supplier had announced that small firms in the southern Chinese province of Fujian are changing their production timing due to power limitations. This comes less than two weeks after iPhone assembler Pegatron Corp. implemented energy-saving propositions in response to power restrictions.