iSuppli Says Half Million iPads at Risk from Foxconn Explosion

The explosion at Foxconn's plant in Chengdu, China, could result in a production loss of 500,000 Apple iPad 2 tablets in the second quarter, according to a new analysis from IHS iSuppli.

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Total iPad 2 production capacity at the Chengdu site amounts to about 500,000 units per month. If the explosion results in a production shutdown until the end of June—which may or may not happen, depending on the outcome of the still-pending investigation—a production stoppage of half a million units could result. Should the production suspension last longer, the impact on production could be even greater.

Foxconn chairman Terry Gou reportedly said that the explosion will not delay the production of the iPad in the third quarter. However, IHS iSuppli believes this view is dependent on a return to full production pending the results of an investigation. IHS iSuppli research indicates there likely will be some impact on production in the second quarter.


While most iPad 2 production takes place at another Foxconn facility in Shenzhen, that plant may not be able to compensate for all the lost output in the second quarter at the Chengdu site. The Shenzhen facility at present has capacity to produce 7.5 million units in the second quarter—iSuppli forecasts 7.4 million iPad 2 units will be shipped out during this period. To support these shipments, Foxconn must manufacture a larger quantity of devices, at between 7.8 and 8.1 million units during the second quarter. This means that Foxconn’s shipments will fall short of expected levels by between 300,000 and 600,000 units in the second quarter.
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A spokesperson for the company told the WSJ that they expect the plant will be shutdown for tests that will take 2 days.

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