Apple faces iPad and MacBook shipment delays amid global component shortage

Delays come despite recent assurances that semiconductor shortage will have a 'limited impact'

Trade

iPad Air

8 April 2021

Apple is facing significant delays to its iPad and MacBook shipments due to an ongoing global shortage of components, it has emerged.

This is despite Foxconn chairman Liu Young-Way recently stating that the severe lack of semiconductors will have a “limited impact” on Apple, which is Foxconn’s largest customer.

In late February, Liu said that Foxconn, formally known as Hon Hai Precision Industry Co Ltd, has “proper precautionary planning” in place in order to protect the operations of its major customers, which also include Cisco, Dell, Huawei, and Microsoft.

In spite of the assurances from its supplier, Apple has reportedly postponed a portion of component orders for its iPad and MacBook devices from the first half of 2021 to the second half, according to sources familiar with the matter, speaking to Nikkei.

Specifically, the component shortage has slowed the process of mounting components on printed circuit boards needed for the final assembly of the MacBook. Meanwhile, iPad manufacturing has significantly slowed due to a shortage of displays and display components, the sources said.

Although Apple sources its semiconductors from Foxconn, Qualcomm, and TSMC, the iPad displays have been historically supplied by its smartphone market rival Samsung, which has also been hit by the global chip shortage. Last month, it was reported that the South Korean tech giant was considering shelving the next Galaxy Note until at least 2022, with Samsung co-CEO Koh Dong-jin warning of a “serious imbalance in supply and demand of chips in the IT sector globally”.

Late last year, Apple admitted that it was struggling to source chips that manage power consumption in a number of its devices, including the iPhone, due to an increase in demand for silicon as well as supply-chain issues related to the spread of coronavirus. Lockdown restrictions on factories as well as the severing of transport routes were also expected to hinder manufacturing output until at least May 2021, according to sources speaking to Bloomberg.

The global component shortage has so far been addressed by the US government, with President Joe Biden signing an executive order addressing the semiconductor supply chain issues in late February. However, with no quick fix for the issue, the global component shortage is expected to continue well into the second half of the year.

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