Apple Brings China's Luxshare Precision into iPhone 13 Supply Chain to Meet Production Targets

[MacRumors]

Apple is tapping more Chinese suppliers as it seeks to meet ambitious targets for iPhone 13 production, according to a new report by Nikkei Asia.

Apple is set to produce between 90 million and 95 million iPhones through January, according to a previous Nikkei report, and China's Luxshare Precision Industry has won 3% of orders away from Taiwanese rivals Foxconn and Pegatron.

Luxshare will start building the iPhone 13 Pro -- as the premium model is expected to be called -- this month, according to sources, a major breakthrough for a company that has never produced iPhones on its own. Newcomers to the Apple supply chain normally start out making older iPhone models. Two companies that Luxshare acquired last year, South Korean camera module maker Cowell and metal frame maker Casetek of Taiwan, will also supply key components and parts for this year's new iPhones, sources familiar with the matter said.

Despite Luxshare's small percentage of iPhone production this year, its involvement has reportedly rattled rival iPhone suppliers are said to be wary of the Chinese manufacturer's competitiveness and the possibility that it could steal away bigger chunks of orders in the future.

Luxshare's ability to break into iPhone production comes despite U.S. trade restrictions on China, whose increasing involvement in Apple's lucrative supply chain has reportedly come at the expense of rivals in the U.S., Taiwan, Japan, and South Korea.

For example, China-based Lens Technology has only supplied glass backs and cover glass for iPhones in the past, but this year it will also supply metal casings for the first time, according to Nikkei.

Meanwhile, China's biggest maker of smartphone camera lenses, Sunny Optical Technology, is also said to have entered the iPhone supply chain for the first time, supplying a small amount of rear camera lenses.

The news comes on the heels of multiple reports suggesting BOE Technology will soon begin supplying OLED panels for the iPhone 13, pending approval from Apple, with several other Chinese suppliers and assemblers waiting in the wings.

Today's report highlights Apple's continuing mission to diversify its supply chain as much as possible, reducing risk and improve its bargaining power between major supply chain players like Foxconn and Samsung, which have traditionally dominated iPhone production.

The iPhone 13 models are expected to be announced next month and will look similar to the 2020 iPhone lineup, with four devices in sizes that include 5.4-inches, 6.1-inches, and 6.7-inches, with two of the iPhones being higher-end "Pro" models and two positioned as lower-cost, more affordable devices.

For everything we know about what's new in the iPhone 13 series, be sure to check out our dedicated roundup.

Article Link: Apple Brings China's Luxshare Precision into iPhone 13 Supply Chain to Meet Production Targets

 

[TheYayAreaLiving 🎗️]

Enabling the future with technology!

I hope my brand new iPhone 13 Pro max is developed by Luxshare Precision.

Right on time! One more month to go!!! Hoping to see more reports like this in the upcoming weeks

 

[robotica]

I wouldn’t want to be one of the first to get one of these from a first time producer.

 

[TheYayAreaLiving 🎗️]

I wouldn’t want to be one of the first to get one of these from a first time producer.

Apple is not going to be blindfolded and give them an opportunity to produce millions of units. There is alot of QA that takes place.

 

[JPack]

Luxshare helped Apple design and manufacture AirPods. They also supply mini LED. So of course Apple trusts Luxshare to build iPhones.

The other iPhone assembler is Wistron. After what happened in December with Indian workers rampaging through the factory, it’ll be a long time before Apple removes Wistron from their probation list.

 

[Shirasaki]

I wouldn’t want to be one of the first to get one of these from a first time producer.

But now with basically scrambled serial number, there is no telling from the outside which iPhone is manufactured by which.

Guess we would see lots of lottery threads heading in September.

 

[InGen]

Apple will no doubt endeavour to take this same approach in its building of a driving system or entire vehicle in the future. Pitting existing car manufacturers against one another in competition to develop and produce the vehicles to which Apple will sell, utilising existing production and supply lines.

Substitute Foxconn, Pegatron & Luxshare with Hyandai, Volvo & BMW and you have what would be the ideal set up to launch an Auto-industry production line of vehicles running entirely on Apple’s currently in-development vehicle-automation software, or…as most of us here would love to see, an automobile designed entirely by Apple from the ground up.

 

[nexusrule]

Apple will no doubt endeavour to take this same approach in its building of a driving system or entire vehicle in the future. Pitting existing car manufacturers against one another in competition to develop and produce the vehicles to which Apple will sell, utilising existing production and supply lines.

Substitute Foxconn, Pegatron & Luxshare with Hyandai, Volvo & BMW and you have what would be the ideal set up to launch an Auto-industry production line of vehicles running entirely on Apple’s currently in-development vehicle-automation software, or…as most of us here would love to see, an automobile designed entirely by Apple from the ground up.

No because car manufacturers have their own brand and design language and so on, they are not anonymous assemblers, Apple will need to pick one for their partnership and stick with them.

 

[iapplelove]

Apple will no doubt endeavour to take this same approach in its building of a driving system or entire vehicle in the future. Pitting existing car manufacturers against one another in competition to develop and produce the vehicles to which Apple will sell, utilising existing production and supply lines.

Substitute Foxconn, Pegatron & Luxshare with Hyandai, Volvo & BMW and you have what would be the ideal set up to launch an Auto-industry production line of vehicles running entirely on Apple’s currently in-development vehicle-automation software, or…as most of us here would love to see, an automobile designed entirely by Apple from the ground up.

Lots of assuming going on here. First you’re assuming consumers share the same excitement as you in regards to Apple getting in the EV game. They don’t. Second, you’re assuming other Auto manufacturer, legacy manufacturers are willing to work with Apple? In the same genre? Hmm

 

[InGen]

No because car manufacturers have their own brand and design language and so on, they are not anonymous assemblers, Apple will need to pick one for their partnership and stick with them.

My presumption based on Apple's previous behaviour would be that they would pick a few different car manufacturers and have them contribute to different iterations of various vehicles, low-end, medium, high etc. Samsung, LG & Sony all contribute parts to the iPhone and yet all companies have/had their own designed phone and design language. Having one doesn't have to exclude the other, I think it would still be a profitable endeavour to the company that does link up with Apple.

 

[tridley68]

Apple needs to start sourcing things within the states and not continue to rely so heavily on China I have no doubt this will be an excellent phone can't wait to upgrade.

 

[Glideslope]

Best of luck to 13 owners with BOE Displays. Despite Apple QC checks.

 

[jimmy_uk]

QC lottery begins!

 

[Shirasaki]

Apple needs to start sourcing things within the states and no continue to rely so heavily on China I have no doubt this will be an excellent phone can't water to upgrade.

Yeah, cause US has all the raw materials, plants, people, technology and such to manufacture new iPhone in a scale of the million right now, yet somehow such amazing production capacity remains untouched by Apple. /s

 

[rpmurray]

I'm wondering how much longer Apple can continue to keep shuttling people between the US and China. It would be much more efficient to just build a new headquarters building in China to be closer to their suppliers and then move out of Cupertino.

 

[Shirasaki]

I'm wondering how much longer Apple can continue to keep shuttling people between the US and China. It would be much more efficient to just build a new headquarters building in China to be closer to their suppliers and then move out of Cupertino.

Building a headquarter in China means much higher risk of having leaks, which Apple does not want to see, unlike we guys.

 

[MacBH928]

Didn't they learn after the pandemic and the US-China economic turmoil not to put all your eggs in one basket? I thought they are starting to move away from China.

Yeah, cause US has all the raw materials, plants, people, technology and such to manufacture new iPhone in a scale of the million right now, yet somehow such amazing production capacity remains untouched by Apple. /s

You must be kidding right? USA has 300M population and is actually the developed country and China is the developing country. We all know why they manufacture in China and its the same reason they do not manufacture in Japan, Germany, nor France... the Chinese labour is cheap.

 

[Shirasaki]

Didn't they learn after the pandemic and the US-China economic turmoil not to put all your eggs in one basket? I thought they are starting to move away from China.



You must be kidding right? USA has 300M population and is actually the developed country and China is the developing country. We all know why they manufacture in China and its the same reason they do not manufacture in Japan, Germany, nor France... the Chinese labour is cheap.

Yeah it’s cheap but many times things are more complicated than that. We don’t have much insider knowledge so there must be other factors preventing them from doing so, such as raw material access.

Apple will consider cutting the tie when the time come.

 

[JPack]

Didn't they learn after the pandemic and the US-China economic turmoil not to put all your eggs in one basket? I thought they are starting to move away from China.

The pandemic proved the resiliency of the Chinese supply chain. Most other countries failed miserably in terms of pandemic containment. China was the only major economy to grow in 2020. If you actually interview major companies, most have increased reliance on China in the last few years. It's same reason why Apple increased the number of Chinese suppliers in 2020 which now represents over 1/3 its total.

You must be kidding right? USA has 300M population and is actually the developed country and China is the developing country. We all know why they manufacture in China and its the same reason they do not manufacture in Japan, Germany, nor France... the Chinese labour is cheap.

The USA is "developed" but doesn't even have a single LCD fab. Forget OLED. Let that sink in for a moment. Meanwhile, China installs over 4x as many industrial robots vs. the U.S. per year. More high speed rail than the U.S. can ever dream of. About 70% of the world's 5G base stations are installed in China. Fully digital currency has been in use for over a decade. Simply put, none of the other countries you mentioned have the market size or infrastructure to manufacture anything in great quantities.

 

[MacBH928]

Yeah it’s cheap but many times things are more complicated than that. We don’t have much insider knowledge so there must be other factors preventing them from doing so, such as raw material access.

Apple will consider cutting the tie when the time come.

When the time comes, Apple and others, will be too entangled in the Chinese system that they either will have to bend the knee for the CCP or lose significant sales and market value and I assure you the capitalist shareholders would rather bend the knee than lose a single dollar.

The pandemic proved the resiliency of the Chinese supply chain. Most other countries failed miserably in terms of pandemic containment. China was the only major economy to grow in 2020. If you actually interview major companies, most have increased reliance on China in the last few years. It's same reason why Apple increased the number of Chinese suppliers in 2020 which now represents over 1/3 its total.



The USA is "developed" but doesn't even have a single LCD fab. Forget OLED. Let that sink in for a moment. Meanwhile, China installs over 4x as many industrial robots vs. the U.S. per year. More high speed rail than the U.S. can ever dream of. About 70% of the world's 5G base stations are installed in China. Fully digital currency has been in use for over a decade. Simply put, none of the other countries you mentioned have the market size or infrastructure to manufacture anything in great quantities.

USA doesn't have LCD fab or others because every investor is taking his money to build it in China.... because its CHEAPER. The world has relied on the western countries like Europe and USA(and maybe Japan) for the past century to build a lot of their products including cars and electronics like radios and televisions. The are about only 2 companies that build major commercial airplanes and that is AirBus and Boeing and they are in USA and Europe. Foxconn has about 1,290,000 employees, I am sure somewhere in Germany or USA that many people looking for a job so no there is no lack of people or capability of building in great numbers... they do it in China because its cheaper in China. The engineer charges less, the chemist charges less, the construction workers cost less...everything is less.

Note I am not against manufacturing in China, I am against relying solely on China, thats to much power to be put in one country/regime hand. That is what is what happened by having every investor taking his business over there. The ideal situation would be something more like a supplier in each of China, Vietnam, Mexico, USA, and Germany for a corporate the size of Apple.

Other people looking for cheap manufacturing opportunities could spread in other south east asian countries like Thailaind and Indonesia, in fact I think some of the business is going to Vietnam. They can also build in South America like Chile and Bolivia, I do not have the numbers but I will guess its as cheap as China.

 

[JPack]

USA doesn't have LCD fab or others because every investor is taking his money to build it in China.... because its CHEAPER. The world has relied on the western countries like Europe and USA(and maybe Japan) for the past century to build a lot of their products including cars and electronics like radios and televisions. The are about only 2 companies that build major commercial airplanes and that is AirBus and Boeing and they are in USA and Europe. Foxconn has about 1,290,000 employees, I am sure somewhere in Germany or USA that many people looking for a job so no there is no lack of people or capability of building in great numbers... they do it in China because its cheaper in China. The engineer charges less, the chemist charges less, the construction workers cost less...everything is less.

Note I am not against manufacturing in China, I am against relying solely on China, thats to much power to be put in one country/regime hand. That is what is what happened by having every investor taking his business over there. The ideal situation would be something more like a supplier in each of China, Vietnam, Mexico, USA, and Germany for a corporate the size of Apple.

Other people looking for cheap manufacturing opportunities could spread in other south east asian countries like Thailaind and Indonesia, in fact I think some of the business is going to Vietnam. They can also build in South America like Chile and Bolivia, I do not have the numbers but I will guess its as cheap as China.

Not sure why this myth persists. I guess if it gets repeated enough times, Americans actually believe it.

If it were about cost, the manufacturing would have moved to India or Africa a long time ago. No other country in the world can match China in terms of infrastructure. If you look at ports for example, the U.S. doesn't have a single fully automated port even today. Same thing for LCD fabs, much of those facilities are automated. With the lack of automation equipment, LCD fabs in America are not viable while they are in Korea, Japan, and China. Why do you think Teslas coming out of Shanghai have a better build quality than Fremont? More automation.

Tim Cook has said it's not about cost, but rather talent. Otherwise, Foxconn wouldn't be paying $1,000 bonus to lure workers for the next iPhone. China produces 10x the number of STEM graduates compared to the U.S. because Americans are aspiring to be social influencers and stock brokers. That has a big effect on technology. Boeing's CEO expects the global commercial aviation market to be a triopoly by 2030 due to COMAC's entry. Once again, that's due to STEM.

 

[MacBH928]

Not sure why this myth persists. I guess if it gets repeated enough times, Americans actually believe it.

If it were about cost, the manufacturing would have moved to India or Africa a long time ago. No other country in the world can match China in terms of infrastructure. If you look at ports for example, the U.S. doesn't have a single fully automated port even today. Same thing for LCD fabs, much of those facilities are automated. With the lack of automation equipment, LCD fabs in America are not viable while they are in Korea, Japan, and China. Why do you think Teslas coming out of Shanghai have a better build quality than Fremont? More automation.

1-They don't build in Africa because africa is in constant political turmoil, its literally not safe, let alone having a decent system where you can go to court and insure your rights. As for India, well they had a factory in India and we all saw what happened.

2-Well if everyone is going to build in China, China will continue to have the infrastructure and everyone is just standing there like idiots. If you want change, you should build the infrastructure else where. I am sure in the 80s China did not have the infrastructure, they built it, and so other countries should head in that direction for the benefit of the rest of humanity instead of all of us relying on china because of the old arguement "they have the infrustracture and we don't" . There was a time when USA and Japan had that infrastructure.

3-I won't comment on the automation thing because last I knew that things built by hand are higher quality, thats what high class brand cars proclaim but if robots make better machines I see no problem in buying those robots and sending them to Fremont.

Tim Cook has said it's not about cost, but rather talent. Otherwise, Foxconn wouldn't be paying $1,000 bonus to lure workers for the next iPhone. China produces 10x the number of STEM graduates compared to the U.S. because Americans are aspiring to be social influencers and stock brokers. That has a big effect on technology. Boeing's CEO expects the global commercial aviation market to be a triopoly by 2030 due to COMAC's entry. Once again, that's due to STEM.

I agree. If USA, and any other country, continue to push for being a social media clown and some failed entrepreneur countries with STEM graduates will win. Thats what made Europe&USA advanced, early 20th century they had the STEM graduates while many rest of the world were mere farmers more or less.

The way things are going, the cycle will reverse and USA will be 3rd world country and China will be leader of the world. Instead of Chinese applying for Harvard and Yale, we will see Americans applying for Tsinghua University.