China's BOE Planning 100M+ iPhone Comeback

[MacRumors]

Chinese display manufacturer BOE is aggressively ramping up its OLED production capacity for future iPhone models as part of a plan to recapture a major role in Apple's supply chain.

In May 2022, Apple halted BOE's inclusion in the iPhone 13's supply chain after detecting unauthorized design modifications. The crisis began when BOE, facing component shortages and yield issues, expanded the circuit width of thin-film transistors in its panels without Apple's approval. When Apple discovered this, Apple instructed BOE to halt production.

Since then, BOE has gradually sought to return to Apple's good graces. The company was later granted approval to resume supplying OLED panels for the iPhone 14, albeit in limited quantities. According to data published in UBI Research's latest China Display Trend Report (via ZDNet Korea), the Chinese supplier intends to play a major role in iPhone production in the future and grow its share of Apple's highly competitive display supply chain.

BOE has concentrated its iPhone panel production capacity at its B11 fabrication plant in Chengdu, Sichuan Province. The facility has been under continuous expansion and now includes 26 Apple-only OLED module lines. Of these, 11 are reported to be in mass production, while an additional three are used solely for development. With each line capable of producing 350,000 panels per month, BOE's output capacity for iPhone displays now totals approximately 8 million units per month. At a 90% utilization rate and an 85% yield, this equates to an annual output of at least 100 million panels.

Today, Apple sources the majority of its OLED panels for iPhones from South Korea-based Samsung Display and LG Display. The reintroduction of BOE into Apple's main iPhone production plans is expected to put price pressure on Samsung Display and LG Display, giving Apple much more negotiation power on unit prices. BOE is also planning to narrow the gap with Samsung and LG in terms of panel brightness, efficiency, and long-term durability.

BOE's presence in Apple's panel supply chain still remains contingent upon meeting strict quality and reliability standards. BOE has been gradually increasing its supply share over successive iPhone generations, but its participation in the initial shipments of new iPhone models remains limited. For the iPhone 16 lineup, BOE did not play a significant role during the early stages of the launch cycle, and a similar outcome is expected for the iPhone 17. As a result, a major increase in supplier share may not occur until the iPhone 18 next year.

Article Link: China's BOE Planning 100M+ iPhone Comeback

 

[MRSugarD]

So Apple and BOE agreed on a certain design in the past but BOE decided to modify it thinking Apple wouldn't notice? Kinda insane if you think about it. How can they be trusted again?

 

[spartan1967]

With all the uncertainty on tariffs, I guess you can use this as a bell-weather. If Apple is not only considering reusing a Chinese vendor & that Chinese vendor is planning on expanding, how bad can the actual out the door tariff cost be? I mean Apple or this vendor is not going to eat the entire tax.

 

[Channan]

The crisis began when BOE, facing component shortages and yield issues, expanded the circuit width of thin-film transistors in its panels without Apple's approval. When Apple discovered this, Apple instructed BOE to halt production.

Can anybody elaborate on this? What exactly does this mean and how would it affect the quality of the displays? Did Apple catch it before any of these displays made it onto iPhones?

 

[Sheepish-Lord]

BOE panels were always sub par

 

[jlc1978]

So Apple and BOE agreed on a certain design in the past but BOE decided to modify it thinking Apple wouldn't notice? Kinda insane if you think about it. How can they be trusted again?

They can't; but the possibility they could become a supplier is useful to pressure current suppliers to lower costs, as TFA points out.

With all the uncertainty on tariffs, I guess you can use this as a bell-weather. If Apple is not only considering reusing a Chinese vendor & that Chinese vendor is planning on expanding, how bad can the actual out the door tariff cost be? I mean Apple or this vendor is not going to eat the entire tax.

Or they could be primarily used in iPhones sold in China, avoiding tariffs and placating the Chinese by using more of their products.

 

[H2SO4]

With all the uncertainty on tariffs, I guess you can use this as a bell-weather. If Apple is not only considering reusing a Chinese vendor & that Chinese vendor is planning on expanding, how bad can the actual out the door tariff cost be? I mean Apple or this vendor is not going to eat the entire tax.

Or Apple and/or BOE have government sanctioned special rates?

 

[Anonymous123]

BOE is also planning to narrow the gap with Samsung and LG in terms of panel brightness, efficiency, and long-term durability

This is why I hate it when there are multiple companies producing a display for a product. There may be tolerances that must be met, but each panel maker is going to produce differences that introduce variability into the product. It’s why people complain about different color temperatures, brightness, etc. on their phones compared to others. Adding another supplier is only going to increase this variability. I’d much prefer to know what I’m getting before I purchase it, and it doesn’t help that this information is kept secret so it can’t be easily determined without extra software that detects the panel supplier.

 

[CWallace]

This is why I hate it when there are multiple companies producing a display for a product.

When you are building literally nine-figures worth of displays a year, that even two suppliers can handle the load is impressive. And if you only have one supplier and they suffer an issue, then Apple has to stop selling iPhones until it is resolved. So even if Samsung or LG was capable/willing to make all of the panels, Apple cannot risk depending on a single-point of failure.

 

[BuffaloTF]

With all the uncertainty on tariffs, I guess you can use this as a bell-weather. If Apple is not only considering reusing a Chinese vendor & that Chinese vendor is planning on expanding, how bad can the actual out the door tariff cost be? I mean Apple or this vendor is not going to eat the entire tax.

They wouldn’t be importing the display from China to the US - so no tariff at all. It’ll certainly be sent to India or Vietnam for assembly, purchased by the local Apple subsidiary in those countries. And the completed device would be imported from one of those countries - not from China. At least not for the US market.

 

[Anonymous123]

When you are building literally nine-figures worth of displays a year, that even two suppliers can handle the load is impressive. And if you only have one supplier and they suffer an issue, then Apple has to stop selling iPhones until it is resolved. So even if Samsung or LG was capable/willing to make all of the panels, Apple cannot risk depending on a single-point of failure.

I’d imagine Samsung or LG could have multiple factories building the same product, so if one suffers an issue then it wouldn’t prevent the product from being sold.

 

[Taipan]

That shape in the photo looks so smooth! Wouldn’t mind going back to that.

 

[Ramchi]

I believe OnePlus which is using BOE panels have been faced with severe green line issues in their OnePlus flagship mobiles (8 Pro, 9 Pro, 10 etc). When I went for service near my place, entire floor with 100 people carrying OnePlus green line mobiles. Fortunately, they gave me (and mostly others as well) coupon worth $500 to exchange it with the newer mobile, first when I encountered it after 3 years of use, they replaced the panel without any charge but when it happened again, they parted with the coupon. Even my Samsung Note 20 Ultra panel started getting green lines after 3+ years of normal use. I never encountered any screen issues with my iPhones so far.

 

[ksec]

I dont think People understand how it works. Apple is *actively* helping BOE so they could produce the panel they want at a much cheaper price.

 

[russell_314]

So Apple and BOE agreed on a certain design in the past but BOE decided to modify it thinking Apple wouldn't notice? Kinda insane if you think about it. How can they be trusted again?

When it comes to business the best policy is “Trust but verify”. I’m guessing that’s how they got caught in the first place. You would be shocked to learn how many companies lied about their products and got caught.

 

[russell_314]

I dont think People understand how it works. Apple is *actively* helping BOE so they could produce the panel they want at a much cheaper price.

Yup because I’m sure Samsung is charging them a premium. I know they also source from LG but it’s best to have backup suppliers

 

[svish]

It will be beneficial for Apple to have more suppliers. However hope that all new panels sourced from BOE will be of good quality.

 

[DBZmusicboy01]

It will be beneficial for Apple to have more suppliers. However hope that all new panels sourced from BOE will be of good quality.

I hope it’s only for the base model iPhones and the iPhone E series and not the Pros. Now for the Pro Max I just hope it’s just Samsung.

 

[jlc1978]

They wouldn’t be importing the display from China to the US - so no tariff at all. It’ll certainly be sent to India or Vietnam for assembly, purchased by the local Apple subsidiary in those countries. And the completed device would be imported from one of those countries - not from China. At least not for the US market.

While companies may do that to hide the country of origin to avoid high tariffs, the US looks at the last country a product was significantly transformed to determine the applicable tariff. Assembling a phone may not qualify as significant transformation by US Customs and so the Chinese tariff rates would apply.

 

[racerhomie]

I believe OnePlus which is using BOE panels have been faced with severe green line issues in their OnePlus flagship mobiles (8 Pro, 9 Pro, 10 etc). When I went for service near my place, entire floor with 100 people carrying OnePlus green line mobiles. Fortunately, they gave me (and mostly others as well) coupon worth $500 to exchange it with the newer mobile, first when I encountered it after 3 years of use, they replaced the panel without any charge but when it happened again, they parted with the coupon. Even my Samsung Note 20 Ultra panel started getting green lines after 3+ years of normal use. I never encountered any screen issues with my iPhones so far.

You can thank Apples Strict Hardware tolerances from suppliers and harmony of Software(Burnin prevention & OS level optimizations) & Hardware working together for that

 

[racerhomie]

I dont think People understand how it works. Apple is *actively* helping BOE so they could produce the panel they want at a much cheaper price.

Yes, that’s what a supplier does!

 

[racerhomie]

I don’t trust BOE as an Apple Supplier. They are not good as they have tried to cheat Apple in the past. Why doesn’t Japan Display make OLEDs? That would give Japan some glory back from its iPhone XR & 11 days

 

[awshucks]

BOE Quality Control: "Not much gets by us!"

 

[CWallace]

I’d imagine Samsung or LG could have multiple factories building the same product, so if one suffers an issue then it wouldn’t prevent the product from being sold.

I am sure they have multiple fabs churning them out and they may very well be in different cities to protect from environmental impacts. But if there was a design issue (like BOE encountered with their proposed panels) or an issue or supply problem with a specific component unique to that single OEM, you still bring production to a complete halt.