Apple reportedly postponed iPad and MacBook production under continuing chip shortage

[Cal Jeffrey]

In context: Large companies like Apple, Samsung, and HP typically have enough clout to get suppliers to prioritize them over smaller companies. Even though chips are hard to come by, these giants still thrived. Now, as Apple struggles to procure parts, the severity of the shortage seems to be coming to a head even for them.

Despite Apple's earnings being through the roof and rumors that its second-generation silicon may be ready in time for fall-released devices, Macbooks and iPads due out in the second half of 2021 will likely be delayed. The global chip shortage is affecting all manufacturers, including Apple, which is now producing its own SoCs full-bore.

The problem is not that Apple cannot manufacture enough of its 5mn M1 chips. It struggles with its supply chain to obtain other components, like disk controllers and display drivers, which rely on silicon manufactured with older processes.

Nikkei Asia notes that Apple has "postponed" production of MacBooks and iPads as it grapples with suppliers to obtain components used at "key" points in its assembly lines.

"Chip shortages have caused delays in a key step in MacBook production -- the mounting of components on printed circuit boards before final assembly," sources say. "Some iPad assembly, meanwhile, was postponed because of a shortage of displays and display components."

So while the M2 chip will be ready as early as July for the next MacBooks later this year, Apple has delayed Q2 component orders until the second half of 2021. The tech giant's action says a lot about how severe the chip shortage has become, considering Apple is very good at managing its supply chain.

The sources say that the move is not affecting iPhone production but did note that the supply of some iPhone parts is still "quite tight." We might not see iPhone delays this year, but if chip manufacturers cannot catch up, we could see Apple skip a year or delay its 2022 flagships until early 2023.

Silicon Motion CEO Wallace Gou has a bleak outlook on the situation. Silicon Motion supplies NAND flash memory controller chips to companies, including Samsung, Western Digital, Micron, and Kingston, to name a few.

"We really don't see an end to this shortage, and things could be even worse, looking ahead to the end of the June quarter, as some smaller tech players could run out of some critical inventories to build their products and need to scale back production," Gou predicted.

Image credit: Apple Building by Vytautas Kielaitis, Inside MacBook by Akram Habibi

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https://www.techspot.com/news/89500-apple-reportedly-postponed-ipad-macbook-production-under-continuing.html

 

[Dimitriid]

I'm still maintaining this shortage might turn out to be partially motivated by artificial constrains, better known as "price fixing" and if they're pressing matters for this long is precisely to affect and reposition their deals with giants like Apple.

Except I think Apple might start to bite back and probably won't take the push laying down so I think Apple will consider bringing even more companies as exclusive partners if not bought outright for the smaller yet critical stuff like what's described on the article. They can certainly afford to and if they haven't done so it's probably to avoid accusation of monopolizing entire supply chains but on the other hand, if they don't do it Samsung will, that is, more than their already far reaching arm into nearly every segment of components.

 

[duckofdeath]

I'm still maintaining this shortage might turn out to be partially motivated by artificial constrains, better known as "price fixing" and if they're pressing matters for this long is precisely to affect and reposition their deals with giants like Apple.

Except I think Apple might start to bite back and probably won't take the push laying down so I think Apple will consider bringing even more companies as exclusive partners if not bought outright for the smaller yet critical stuff like what's described on the article. They can certainly afford to and if they haven't done so it's probably to avoid accusation of monopolizing entire supply chains but on the other hand, if they don't do it Samsung will, that is, more than their already far reaching arm into nearly every segment of components.

Yeah, it's not mining causing this. It's either cartels or fabs defrauding the market with promises they knew they were never able to keep.

 

[oldikes]

Its also a huge drought in Taiwan greatly affecting chip production, a global pandemic that created unprecedented demand for consumer tech (and thats before you consider stimulus checks and lower interest rates in many places), a lagging slowdown in supply caused by earlier pandemic production shutdowns, and a drastic increase in the cost of international freight caused by all sorts of factors, including the need to ship pandemic supplies and one of the largest ships in the world getting itself stuck austin-powers style in a vital global trade route for a week.

Not everything is a conspiracy.

 

[Austinturner]

Large demand for consumer durable goods driven by government stimulus, rising prices of commodities and hard assets and shortages of consumer goods. If it looks like inflation and quacks like inflation...

 

[Squid Surprise]

This is merely a side-effect of a global pandemic.... Yes, I know many of you think it's just a worldwide conspiracy to keep us at home.... but it turns out it might actually be real...

In a few years, it will hopefully be a thing of the past...

 

[mbrowne5061]

I'm still maintaining this shortage might turn out to be partially motivated by artificial constrains, better known as "price fixing" and if they're pressing matters for this long is precisely to affect and reposition their deals with giants like Apple.

Except I think Apple might start to bite back and probably won't take the push laying down so I think Apple will consider bringing even more companies as exclusive partners if not bought outright for the smaller yet critical stuff like what's described on the article. They can certainly afford to and if they haven't done so it's probably to avoid accusation of monopolizing entire supply chains but on the other hand, if they don't do it Samsung will, that is, more than their already far reaching arm into nearly every segment of components.

Oh? And how are they making money with these shortages?

Price fixing is like what happened with RAM a few years ago, and HDDs before that: you never had any trouble whatsoever finding the products in stores and online, the MSRPs were just insanely high compared to what they used to be - and bucked long term downward trends in prices.

No company is making more money by selling less, not even the suppliers. Price fixing is when the whole industry decides to pretend there is a shortage, use that to charge more, but still meet all their obligations. But obligations are not being met if Apple, Toyota, and Ford are having trouble sourcing parts.

 

[Dimitriid]

Oh? And how are they making money with these shortages?

Price fixing is like what happened with RAM a few years ago, and HDDs before that: you never had any trouble whatsoever finding the products in stores and online, the MSRPs were just insanely high compared to what they used to be - and bucked long term downward trends in prices.

No company is making more money by selling less, not even the suppliers. Price fixing is when the whole industry decides to pretend there is a shortage, use that to charge more, but still meet all their obligations. But obligations are not being met if Apple, Toyota, and Ford are having trouble sourcing parts.

Who said they're "Selling less"? They're not meeting demand but they are certainly not "selling less" they're just behind in terms of their claimed capacity and that's what I am contesting: even though they should be normalizing right now after many COVID related restrictions have been lifted and there's been some time for the heavy-hitting initial releases of the 2020 Holiday season (With AMD, Nvidia, Apple, Sony and Microsoft all releasing highly demanded products simultaneously almost) the stories about how "We are now facing undetermined issues meeting this crazy demand!" just keep increasing, creating a narrative to just avoid the prices to come back down: just selling as much as there's demand for products right now would crash the inflated prices but making excuses to keep saying "We still can't meet demand, and wont for this year altogether" means that they can keep selling the same volume of items, which is really high, at the higher-than-normal prices because they're manipulating panic purchases and inventory building just to maintain high demand artificially.

 

[Squid Surprise]

Who said they're "Selling less"? They're not meeting demand but they are certainly not "selling less" they're just behind in terms of their claimed capacity and that's what I am contesting: even though they should be normalizing right now after many COVID related restrictions have been lifted and there's been some time for the heavy-hitting initial releases of the 2020 Holiday season (With AMD, Nvidia, Apple, Sony and Microsoft all releasing highly demanded products simultaneously almost) the stories about how "We are now facing undetermined issues meeting this crazy demand!" just keep increasing, creating a narrative to just avoid the prices to come back down: just selling as much as there's demand for products right now would crash the inflated prices but making excuses to keep saying "We still can't meet demand, and wont for this year altogether" means that they can keep selling the same volume of items, which is really high, at the higher-than-normal prices because they're manipulating panic purchases and inventory building just to maintain high demand artificially.

Newsflash.... the pandemic isn’t over.... the shortage isn’t just for a ‘few months’.... and sales will be affected for some time to come...

 

[ThrakazogZ]

Its also a huge drought in Taiwan greatly affecting chip production, a global pandemic that created unprecedented demand for consumer tech (and thats before you consider stimulus checks and lower interest rates in many places), a lagging slowdown in supply caused by earlier pandemic production shutdowns, and a drastic increase in the cost of international freight caused by all sorts of factors, including the need to ship pandemic supplies and one of the largest ships in the world getting itself stuck austin-powers style in a vital global trade route for a week.

Not everything is a conspiracy.

I bet you're one of those people payed by the big fabs to defend their secret conspiracy.......but not payed in cash (could be traced), but in dumplings (untraceable).......meat and vegetable....because if they only sent the expensive meat dumplings, we'd all know something was up......but a variety of meat and vegetable dumplings are less suspicious.....but I'm not fooled by the meat and vegetable dumplings.....I know what's going on......

 

[Dimitriid]

Newsflash.... the pandemic isn’t over.... the shortage isn’t just for a ‘few months’.... and sales will be affected for some time to come...

Check how long it has been since most places in China fully reopened. See, just about the only good part about running a nightmarish authoritarian regime is that you really can just order people to stay home and close all businesses and they'll just do it or find themselves in jail for totally unrelated offenses.

And this isn't even much of a "conspiracy" by the way, China is infamous for how strict they are about censorship and suppression, the whole point is that most of the west and even most citizens internally would have no clue if something like an artificial constrain was just decided without much fanfare.

 

[Squid Surprise]

Check how long it has been since most places in China fully reopened. See, just about the only good part about running a nightmarish authoritarian regime is that you really can just order people to stay home and close all businesses and they'll just do it or find themselves in jail for totally unrelated offenses.

And this isn't even much of a "conspiracy" by the way, China is infamous for how strict they are about censorship and suppression, the whole point is that most of the west and even most citizens internally would have no clue if something like an artificial constrain was just decided without much fanfare.

How is that relevant?
This is a GLOBAL pandemic... yes places are starting to reopen NOW.... but they’ve been inactive for months.... it will take awhile for everything to get back to “normal”.

 

[mbrowne5061]

Who said they're "Selling less"? They're not meeting demand but they are certainly not "selling less" they're just behind in terms of their claimed capacity and that's what I am contesting: even though they should be normalizing right now after many COVID related restrictions have been lifted and there's been some time for the heavy-hitting initial releases of the 2020 Holiday season (With AMD, Nvidia, Apple, Sony and Microsoft all releasing highly demanded products simultaneously almost) the stories about how "We are now facing undetermined issues meeting this crazy demand!" just keep increasing, creating a narrative to just avoid the prices to come back down: just selling as much as there's demand for products right now would crash the inflated prices but making excuses to keep saying "We still can't meet demand, and wont for this year altogether" means that they can keep selling the same volume of items, which is really high, at the higher-than-normal prices because they're manipulating panic purchases and inventory building just to maintain high demand artificially.

You somehow made a whole paragraph out of two sentences. Anyway, I can tell you've never worked in a factory before because that is now how supply chains work at all. Especially not "lean" ones that don't maintain inventory beyond product being worked.

They are selling less. You can debate the why but not the fact they there are supply shortages - and no one makes more money from selling fewer units than they used to.

Check how long it has been since most places in China fully reopened.

Most of these chips come from Taiwan, not the mainland. Completely different governments. Taiwan has not reopened at all yet. They are also suffering from a drought, and the water needed to make these chips runs out at the end of this month.