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Report: Amid iPhone 8 production struggles, Apple purchases its own equipment to lease to suppliers

According to a new report out of The Korea Herald, Apple is taking matters into its own hands to ensure that key iPhone 8 parts are ready in time for the device’s release. The report says that Apple has recently purchased production equipment that allows it to produce a key component of the iPhone 8 due to one supplier backing out of its agreement…

The production equipment is for the rigid flexible printed circuit board, which is a key part of the iPhone 8 that connects chips with each part of the device, such as the screen and camera.

The purchase, which is said to have been “pricey” and worth “tens of millions of dollars” is a bit out of the blue for Apple. The company doesn’t own a production plant were it can install the new equipment and it already had deals in place to secure the part in question from three different suppliers.

“Industry sources” say, however, that Apple is leasing the new equipment to suppliers to make sure the parts are produced on time. Amid reports that the iPhone 8 faces production delays, one of the three suppliers Apple had planned to secure the RFPCB part from recently pulled out of the agreement.

By purchasing its own equipment and leasing it to suppliers, Apple hopes that it can expedite the production process and take some of the burden off the two remaining suppliers.

“To fill the loss, Apple is supporting the other two suppliers, both Korean, to beef up production,” said the source.

The RFPCB is a newer, more difficult to manufacture version of the PCB. It’s caused some manufacturers difficulty during production, and Apple’s stringent quality requirements have made the work even harder. Apple is expected to order 100 million units of RFPCB this year.

The RFPCB is an upgraded version that is more difficult to make compared to the conventional rigid or flexible PCB. Apple will use the parts for the touch screen panel of the new iPhone, tentatively called iPhone 8.

The exact reason why the Taiwanese supplier withdrew from the deal with a big client Apple was not revealed. But sources say the firm may have felt a pinch on the tricky production and strict quality requirements along with low profitability.

This week has largely been dominated by reports claiming Apple is in a “panic” in the lead up to the iPhone 8’s release this fall. Some say the device may ship with key features disabled at first, while others say the release may be pushed back altogether.

Stay up to date with all iPhone 8 rumors in our continually updated guide here.

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Avatar for Chance Miller Chance Miller

Chance is an editor for the entire 9to5 network and covers the latest Apple news for 9to5Mac.

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