Apple Brings China's Luxshare Precision into iPhone 13 Supply Chain to Meet Production Targets
Apple is set to produce between 90 million and 95 million iPhones through January, according to a previous Nikkei report, and China's Luxshare Precision Industry has won 3% of orders away from Taiwanese rivals Foxconn and Pegatron.
Luxshare will start building the iPhone 13 Pro -- as the premium model is expected to be called -- this month, according to sources, a major breakthrough for a company that has never produced iPhones on its own. Newcomers to the Apple supply chain normally start out making older iPhone models. Two companies that Luxshare acquired last year, South Korean camera module maker Cowell and metal frame maker Casetek of Taiwan, will also supply key components and parts for this year's new iPhones, sources familiar with the matter said.
Despite Luxshare's small percentage of iPhone production this year, its involvement has reportedly rattled rival iPhone suppliers are said to be wary of the Chinese manufacturer's competitiveness and the possibility that it could steal away bigger chunks of orders in the future.
Luxshare's ability to break into iPhone production comes despite U.S. trade restrictions on China, whose increasing involvement in Apple's lucrative supply chain has reportedly come at the expense of rivals in the U.S., Taiwan, Japan, and South Korea.
For example, China-based Lens Technology has only supplied glass backs and cover glass for iPhones in the past, but this year it will also supply metal casings for the first time, according to Nikkei.
Meanwhile, China's biggest maker of smartphone camera lenses, Sunny Optical Technology, is also said to have entered the iPhone supply chain for the first time, supplying a small amount of rear camera lenses.
The news comes on the heels of multiple reports suggesting BOE Technology will soon begin supplying OLED panels for the iPhone 13, pending approval from Apple, with several other Chinese suppliers and assemblers waiting in the wings.
Today's report highlights Apple's continuing mission to diversify its supply chain as much as possible, reducing risk and improve its bargaining power between major supply chain players like Foxconn and Samsung, which have traditionally dominated iPhone production.
The iPhone 13 models are expected to be announced next month and will look similar to the 2020 iPhone lineup, with four devices in sizes that include 5.4-inches, 6.1-inches, and 6.7-inches, with two of the iPhones being higher-end "Pro" models and two positioned as lower-cost, more affordable devices.
For everything we know about what's new in the iPhone 13 series, be sure to check out our dedicated roundup.