Later this year, Apple will outsource manufacturing of the cheaper version of its latest iPhone, the iPhone 5C, to Wistron Corp., a Taiwan-based contract maker that currently produces smartphones for BlackBerry Ltd. and Nokia Corp., the people said. Apple also plans to add Compal Communications Inc. to assemble its iPad Mini tablet starting next year, the people said.
The report notes that Apple's main assembler, Hon Hai, is focused on producing the high-end iPhone 5s, which is currently in short supply. Notably, Hon Hai may not be interested in dedicating all its manufacturing capacity to Apple.
"Hon Hai Chairman Terry Gou is not willing to cut contract prices substantially to get more orders from Apple. Hon Hai is also aware of the risk of building gigantic production capacity for a single customer so it is adopting a more cautious stance on expanding production," said a Hon Hai executive, who declined to be named.