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Apple has virtually cut Chinese display manufacturer BOE out of the iPhone 13's supply chain after discovering design changes to its OLED panels, The Elec reports.

iPhone-13-Face-ID.jpeg

Nevertheless, BOE is unlikely to be excluded from Apple's OLED panel supply chain going forward because its presence puts pressure on Samsung Display and LG Display to be more competitive and cut prices. BOE's factory in Sichuan is said to still be operational, and it is possible that BOE is currently working on a workaround to meet Apple's requirements.


BOE has manufactured OLED panels for the iPhone 12 and iPhone 13 at two factories in China, accounting for just 10 percent of all iPhone displays in 2021, but the company has been planning a significant expansion to overtake LG Display as one of Apple's main suppliers of iPhone displays in 2023.

Article Link: Apple Drops BOE iPhone Displays After Discovering Unexpected Design Changes

That could read as the lack of presence of BOE also puts pressure On Samsung display an LG display? Maybe.

Bye-bye BOE your mess this one up big time
 
I live in Asia. Been here for 20 years. If you don’t run your own QC (Apple obviously does) then many of the locals in China feel as if they’ve achieved something spectacular if they can get away with dropping quality midway, to pocket more money. It’s an endemic problem in Asia, and many, many foreign companies learned the hard way.

US manufacturers once took great pride in “a job well done.” Japanese manufacturers are about perfection. Germans will over-engineer a product to amazing specs. But Chinese will wheel and deal in a lightning fashion, then pull the rug out from under quality and feel absolutely giddy if they can get away with giving less than was ordered. Proud, in fact.

Of course, there are companies who have learned long term gains are better than short term cheats. Juggernauts like Apple will give their business to the first group, and dump the rest like a bad habit.

It’s not racist to call this out. China is not a race. It is a cultural issue they have been changing (but it still exists). Korea was once this way, but it has become a world leader in tech, and they are darned proud of it.

Curious why say you live in Asia, Instead of mentioning the city of the country you live in?
 
Changing specifications behind a client's back to reduce operating costs? That's a big no-no.
It's part of Chinese business mentality. If you want to use Chinese manufacturers, you have to have a westerner over there to monitor quality control. If you don't, you will get a mess. It works, as long as you know how it works.
 
What does Apple expect from a Chinese manufacturer that is par the course.
This is what Chinese drug maker Zhejiang Huahai Pharmaceutical did in 2012 with the blood pressure medicine valsartan, brand name Diovan. They changed the manufacturing process to save costs and it caused the drug to be contaminated with potentially cancer-causing chemical N-nitrosodimethylamine, or NDMA. The really awful thing is it wasn't discovered until 2018.
 
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But Chinese will wheel and deal in a lightning fashion, then pull the rug out from under quality and feel absolutely giddy if they can get away with giving less than was ordered. Proud, in fact.

So, the Chinese are Ferengi?
 
Out of curiosity is there a chart for which suppliers produce panels for which iPhone models?
 
I disagree. China is known for dodgy practices in general. You have them manufactoring dangerous knock off chargers, selling questionable batteries, stealing IP, selling equipment that failed QC or a device that was supposed to be destroyed, and making design/material changes without approval.
My dad’s company pulled manufacturing from China to the USA because of suppliers substituting cheaper materials and the quality deteriorating and being inconsistent. It was not due to American greed. It was shady business practices.

It’s a known problem in China. Brand new school collapsed due to substandard materials and bribed inspectors, a common occurrence in some regions. The same kind of problems the USA faced routinely 80+ years ago before we got more serious about safety.
 
Its pretty normal in this space, although it usually isn't to reduce operating costs but increase yields. Just like an architect will design a house and then the builders have to change the design to make it actually work, PCB designers will design a board and to increase yields, the PCB maker will make slight modifications to make it work without informing the parent company. This is also how companies keep clients, when they switch to someone else and their quality plummets, they'll come back without knowing why the competitor was so bad.
Uh, no. The builders don’t get to “change the design.” They may ask the architect to do so, or the plan checkers may require the architect to do so, but the architect is in charge and must be involved in all changes.

Are you saying the e-manufacturers routinely change designs while never informing their client?
 
Apple is doing business in China long enough so they know how things works over here:
- Singing a contract is not the end of the negotiations, it is just a step. Chinese people always leave out hidden costs and it is your fault if you don't think of everything and if you don't have your people on ground to constantly check on them (Apple used to send a lot of engineers on business flights to the Shenzen area)
- Chinese companies always try to cut corners as they only care about making money
- Doing business these days are more difficult as bribing officials is now out of the question so that makes life harder for large foreign corporations
- Apple can and will be pressured to give back production to BOE so they better prep a new team and send them over. It is the cost of doing business in China as a huge US company who manufactures stuff by Taiwanese companies. They are smart enough not to escalate this further just before the party congress in the autumn
 
This is what Chinese drug maker Zhejiang Huahai Pharmaceutical did in 2012 with the blood pressure medicine valsartan, brand name Diovan. They changed the manufacturing process to save costs and it caused the drug to be contaminated with potentially cancer-causing chemical N-nitrosodimethylamine, or NDMA. The really awful thing is it wasn't discovered until 2018.
Poison pet food. Poison baby formula. Poison fish tank chemicals. Poison frozen dumplings. The list of deadly products produced by “modifying” ingredients is long.

And how about the contaminated drywall?
 
Listen my fellow MacRumors members, this is when you should file a class action lawsuit for, not an OS not meeting your greedy demand.

I love how that iPadOS thread has become a standardized reference point in the MacRumors canon ?
 
Uh, no. The builders don’t get to “change the design.” They may ask the architect to do so, or the plan checkers may require the architect to do so, but the architect is in charge and must be involved in all changes.

Are you saying the e-manufacturers routinely change designs while never informing their client?
I'm not sure what an e-manufacturer is, but the PCB manufacturer will fix board designs without telling the customer. I'm wondering why this is a surprise to you based on what you previously posted about your father being in the business...thats literally the same thing I'm saying.
 
Not all Chinese manufacturers are bad. The reason why China got a reputation for cheap products had nothing to do with Chinese people or corporations but an American corporation specifically one that wanted the cheapest possible items and bought it in bulk to sell at an extreme markup. 60 years later they’re still doing this.
Actually that's not entirely true. It's more nuanced. Really Chinese business ethics are somewhat more variable than people seem to realise. You can indeed pay China to do a top notch job but maintaining consistency and quality while maintaining intellectual property secrets is a really really difficult task. All it takes is one guy on commission somewhere or taking a bribe to really screw things up for you.

A number of years ago I wanted a simple board assembled there and to cut costs they actually made a design change to it and shipped it to me at the same cost. The change was an opamp and package sub (so PCB and BOM change). It did not meet noise figure specifications because they did not understand the design specification. A friend of mine shipped a product and it was cloned and cost cut within two weeks. This is what you're going to see all the time there and if you end up discussing it with the assembly managers they suddenly break out a case of English language amnesia...

The US and Europe are the same though. The thing is we don't make stuff here anymore so can pretend to take the moral high ground 🤣
 
When will Tim Cook ever learn that BOE is not the way to go? Just go with Samsung and LG. I just don’t understand why he is taking risk to squeeze pennies. BOE has been unreliable for years.
I always got a feeling that it was politically motivated, especially considering that they were supplying such a small percent of screens compared to Samsung and LG.

One person who does small lots (5000 pieces) say that US small-MOQ manufacturing is better now. From a machinery and tooling point of view small-MOQ equipment is becoming more accessible as well, although it's amusing that most of those are made in China too.
I've heard the same thing. American made isn't necessarily fast or cheap, but by the time you go back and forth with a Chinese company 10 times and wait for shipping, the American made parts end up being cheaper and faster to acquire. Plus the American companies will better understand context, and can catch tooling issues that a Chinese company would just produce to spec.
 
"....expanding the circuit width of the thin-film transistor."

What is the significance of this design change?
 
"....expanding the circuit width of the thin-film transistor."

What is the significance of this design change?
Any design change within the electronics manufacturing world has to go thru engineering change notifications and validated by the end customer. You can't just change a spec on a component without letting the customer know and more so do it with mass production units.

In the manufacturing world, that's grounds for huge contractual fines and chargebacks.
 
Any design change within the electronics manufacturing world has to go thru engineering change notifications and validated by the end customer. You can't just change a spec on a component without letting the customer know and more so do it with mass production units.

In the manufacturing world, that's grounds for huge contractual fines and chargebacks.
Sure, but that's obvious. What I'm wondering is what are the technical and financial ramifications of this change? That's what I meant when I asked about its significance.
 
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Sure, but that's obvious. What I'm wondering is what are the technical and financial ramifications of this change? That's what I meant when I asked about its significance.
I don’t know about this specifically, but, broadly speaking, the technical ramifications could include lower clearance tolerances on parts, parts that have worse thermal performance (because the component’s thermal performance is based on its surface area), or something like that. The financial ramifications could include parts that fail sooner than expected, screen display issues causing Apple to have to introduce a replacement program, class action lawsuits against Apple for the display not operating to spec.
 
Sure, but that's obvious. What I'm wondering is what are the technical and financial ramifications of this change? That's what I meant when I asked about its significance.
Every designed part as a specific footprint it must fit and a function it has to do. If anything of the sort is made different, tests must be done to ensure the change doesn't cause any issues. Sometimes this issues are things not seen until later, much later. That's why the engineering change notification.

As per financial, two thing:
  1. Costing BOE more due to a thicker substrate
  2. Costing BOE less due to a higher yield of components versus components deemed not acceptable.
However, long term, as they found out, they lost the contract which means financially they became attached to another object by an inclined plane wrapped helically around an axis.
 
I don’t know about this specifically, but, broadly speaking, the technical ramifications could include lower clearance tolerances on parts, parts that have worse thermal performance (because the component’s thermal performance is based on its surface area), or something like that. The financial ramifications could include parts that fail sooner than expected, screen display issues causing Apple to have to introduce a replacement program, class action lawsuits against Apple for the display not operating to spec.
Sure, I these are all possibilities I've considered as well. But this doesn't answer my question. What I'm wondering if anyone knows the specifics.
 
Every designed part as a specific footprint it must fit and a function it has to do. If anything of the sort is made different, tests must be done to ensure the change doesn't cause any issues. Sometimes this issues are things not seen until later, much later. That's why the engineering change notification.

As per financial, two thing:
  1. Costing BOE more due to a thicker substrate
  2. Costing BOE less due to a higher yield of components versus components deemed not acceptable.
Again, you're just speculating and speaking in generalities. I'm wondering if anyone knows the specifics.
 
Again, you're just speculating and speaking in generalities. I'm wondering if anyone knows the specifics.
That is specific. I work in manufacturing and those are two specific examples. The thicker the substrate, the more you use, hence higher cost to manufacture.

Every manufacturing contract has clauses regarding tolerances and clients like Apple have clauses regarding parts that don't meet those tolerances. In fact, the automotive and electronics manufacturing contracts have a charge back clause in case a production line stops due to component shortage due to components being out of spec.

For electronics the guidelines are the blueprints and the Types depending on either if the component is SMT or THT.
 
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