Apple is reducing iPad production to allocate more components to iPhone 13 production. This could be a sign that the global chip crisis may hit Apple more than anticipated.
According to Reuters, records from Asia Nikkei show that iPad production has halved in the past two months. This is intended so that the iPhone 13 has enough components to keep production running. Also according to these two media, components designed to produce older iPhone models are also being diverted to iPhone 13 production.
This could be an indication that the global chip shortage is also affecting Apple’s manufacturing operations in a more significant way than previously anticipated. The production of iPhone 13 has encountered some obstacles after factories in Asia were forced to close due to the outbreak of the Covid-19 pandemic and demand for the device increased in the second half of this year.
Previously, Apple’s establishment of long-term supply contracts with chipmakers thanks to its huge purchasing power gave the company an advantage in weathering the global chip crisis. However, the situation may be turning more difficult and complicated than expected, which will force Apple to prioritize production of the iPhone 13 over the new iPad.
Apparently, the source of this decision is Apple’s anticipation of greater demand for the iPhone 13 than for the iPad in the final months of this year as Western markets seem to start to pick up steam in the post-pandemic period.
Reportedly, the business iPhone brought in about $192 billion for Apple last year. Meanwhile, the iPad business brought in nearly $ 32 billion for the company. These are both two product lines that dominate their respective markets on a global scale.