Monday, October 29, 2012

Apple Inc. (NASDAQ:AAPL)’s iPad Mini faces supply issues

The excitement over the launch of the new iPad Mini has barely subsided, and already, there is an issue with the sully of the new, smaller tablet which Apple Inc.(NASDAQ:AAPL) introduced only a few days ago. The supply of the new tablet is getting delayed, and most sources and analysts are hinting that this is a direct result of the broken relationship between Apple and Samsung.

The two companies may have been competitors since the very beginning, but their relationship has turned very sour recently. Samsung used to supply the display for the Apple devices. Although on-field they were competitors without a doubt, off-field, they had a decent working relationship, but due to all the patent lawsuits between these two companies, the working relationship too, had to be terminated. This has left Apple with two vendors who will supply the display for their new iPad Mini: LGD and AUO.

While the company may have two vendors, AUO is new to this business, and as such, has not quite managed to match the flow of the work. The volume of their production has to increase drastically for them to keep up with the pace. Therefore, Apple is depending on LGD to get the supply moving, but it is proving to be a difficult task. For the month of September, AUO was able to yield only 100,000 displays. The target is to get about 400,000 for the month of October, double that amount for the month of November, and a million units for the month of December. LGD is far ahead in its work, though. The company gave out 300,000 for September, it plans on hitting a million in October, and in December, and the company wants to make about 3 million units.

The iPad mini is smaller and more affordable than the original iPad. The base price is $329, and it has a 7.9 inch display, with 1,024x768 as other display specs, with a battery life of 10 hours without charging, and with a dual core A5 processor. The point was, to get more cusmtoers by making it more affordable and smaller. But this plan seems to have backfired, as the estrangement from Samsung has inadvertently caused the supply line to clog up due to slow production.

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