Japanese Earthquake Poses Potential Supply Problems
The IHS iSuppli teardown analysis belonging to the iPad 2 so far has been able to identify five parts sourced from Japanese suppliers: NAND flash from Toshiba Corp., dynamic random access memory (DRAM) made by Elpida Memory Inc., be sure you compass from AKM Semiconductor, the touch screen overlay glass likely from Asahi Glass Co. and also the system battery from Apple Japan Incorporated.
There potentially are other components from Japan in the iPad 2, however, the teardown analysis process cannot always identify all components' countries of origin.
While notice suppliers reported that their facilities were undamaged, delivery of aspects of all of these companies may be impacted at least to some degree by logistical issues now plaguing most Japanese industries in the quake zone. Suppliers are expected to encounter difficulties to get raw materials supplied and distributed and also in shipping out lotions. They also are facing difficulty with employee absences because of problems is not transportation console. The various challenges are being compounded by interruptions your electricity supply, which can have a major influence delicate processes, such as semiconductor lithography.
Furthermore, semiconductor facilities in Japan that had suspended manufacturing activities after quake cannot truly commence full production again until the aftershocks stop. 'Earthquakes ranging from 4 to 7 using the Richter scale will make it impossible to restart these fabs till the earthquakes stop happening by using these frequency,' commented Dale Ford, Senior Vice President, Market Intelligence at iSuppli.
These issues may come at a time when Apple is rushing to ramp up iPad 2 production fulfill stronger-than expected demand for the device. The company this week announced that iPad shipments from the Apple Store have been delayed by one week from previous lead times because among the surge preferred.
Apple's associated with NAND flash memory originates under scrutiny in light of a short-term suspension of production along with the resulting scrapping of some wafers at Toshiba's main NAND production facility. However, the NAND devices utilized in the iPad are which is available from alternative sources, including South Korean semiconductor giant Samsung Electronics Co. Ltd. and U.S. memory maker Micron Technology Inc.
The compass and glass supply can be to a little more problematic issues for Firm. Compasses are available from other sources including Yamaha, Aichi Steel, Alps and STMicroelectronics. However, elements are not easily disposable.
'The calibration of electronic compasses is tricky for a lot of reasons,' said Jeremie Bouchaud, director and principal analyst for MEMS and sensors at IHS. 'Compasses are sensitive to electromagnetic disturbance. Furthermore, the iPad 2's compass works near to coordination together with tablet's accelerometer and gyroscope. This causes it to be impossible just replace one manufacturer's compass with a person more.'
Physical tests conducted by IHS demonstrate that the ipad 2 glass is more flexible and durable than the glass include with the iPad 1, possibly indicating that the glass is Asahi's Dragontrail.
Asahi Glass reported damage to two of its facilities and damage at a third.
The iPad 2's three-cell battery pack on the iPad 2 is labeled 'assembled in China.' However, this label refers towards whole battery. Further investigation showed the car battery itself was designed by Apple Japan, which operates as a subsidiary of Apple.
'Typically, battery cells are intended at the blog of assembly but capsicum is derived from iPad 2's lithium-ion polymer battery is unusually thin, it likely requires advanced battery cell manufacturing technologies that have a home in Japan,' opines Wayne Lam, senior analyst, competitive analysis, at IHS.
Logistical disruptions may show that Apple might have difficulties obtaining this battery, and it will not be able to secure supply from an external, non-Japanese source.