Apple supplier Foxconn will spend $2.6 billion over the next two years to build a new manufacturing plant in Taiwan. The factory will be used exclusively to produce displays for the Cupertino-based company according to a report from Bloomberg.
Sophia Cheng, a PR representative for Innolux Corp. which is Foxconn’s display unit, told the publication the new facility will be constructed at its Science Park campus in Southern Taiwan. Equipment installation will get under way next month and will ultimately provide 2,300 jobs in the area.
The facility is expected to start mass producing panels by the end of next year although Cheng was unable to confirm if a supply deal had been signed with Apple. The spokesperson only said that an urgent request for exclusive capacity was made.
Carolyn Wu, an Apple spokesperson in the region, declined to comment on the matter.
Apple is no stranger when it comes to seeking out exclusive supplier deals as they’ve signed such deals agreements with Samsung and GT Advanced Technologies in the past. The company offered to pay cash for a similar arrangement through Taiwan Semiconductor Manufacturing Company although it was ultimately rejected.
Exclusive arrangements with suppliers are one of the ways Apple tries to limit component shortages. Apple experienced shortages of its metal casings for the iPhone 5 when it launched which led to the company being unable to keep up with consumer demand. Similar issues this year have resulted in continued inventory problems with the iPhone 6 Plus.
While certainly not a bad problem to have, it’s no doubt costing Apple some sales.