Production Delays Could Mean Short Supplies of the New iPhone

Telecom & Wireless

Published: August 31, 2012 8:33 am

Rumor has it that Sharp has fallen behind schedule on production of screens for Apple Inc.’s (NASDAQ: AAPL) latest iPhone, just weeks before a planned launch. In fact, Sharp has not started mass producing screens for Apple’s next-generation smartphone, signaling potential supply problems for the U.S. company.

Sharp had planned to begin shipping iPhone screens to Apple by the end of August, but the Japanese display maker is struggling with high costs that have cut into its margins on the screens. It is unclear how far behind schedule the output has fallen, and Sharp has declined to acknowledge that Apple is the customer effected by delays.

Apple has tapped two other suppliers for its screens — Japan Display and South Korea’s LG Display — and is still planning a major product launch on Sept. 12, which many believe will be the next iPhone.

But the delay in Sharp’s delivery raises questions about whether Apple can secure enough iPhone screens to meet the strong demand expected for the new model.

There is a lot at stake for Apple with this new iPhone. Despite its recent court victory over rival Samsung, Apple is still battling the South Korean company for dominance in the smartphone market.

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