Apple Supply Chain Not Able to Satisfy iPad 2 Demand?

I hope you’ve already braved the long lines and staggering wait times to get your hands on an iPad 2, because according to Taiwanese news site DigiTimes, Apple’s suppliers may not be able to continue to satisfy supply demands from Apple. This could potentially affect future shipments of iPad 2 and iPhone 4 orders.

Apparently, Foxconn Electronics, a key Apple supplier, is facing shortages of labor and materials at its factories in Chengdu, China and may be unable to keep up with Apple’s increasing sales.

From the article:

“Commenting on the rumor, Foxconn only emphasized that the company’s capacity is being arranged fully at the request of its clients and the company will do all it can to satisfy its clients’ needs; however, the company declined to comment whether the labor shortages will cause delays in shipments. Foxconn emphasized that it has experience arranging manpower to assist its clients in reaching their goals.”

Apple estimates continued growth of iPhone and iPad sales, eventually reaching 20-22 million and 10-10.5 million, respectively, in the second quarter of 2011. This puts significant pressure on upstream assembly partners, Foxconn and Pegatron Technology. While Foxconn planned on an annual capacity of 40 million units, Japan’s earthquake impacted component supplies that go to the plants in Chengdu, which may impair their ability to supply Apple with the 2.5-3 million iPad 2’s per month that Apple is projected to sell.

It’s tough to get an iPad 2 even when they are in stock, but wait times have recently gone down, from 3-4 weeks to 1-2 weeks. However, when and if supplies dry out, expect those wait times to rocket back up and those lines to get long once again. If you’re waiting to get an iPad 2, it may be wise to get one now before demand outreaches supply even further.

About Juli: Contact me via Twitter: @julipuli

  • Andy Raczynski

    that’ll be a lot of people cursing when the ipad3 rolls out and they just finally got their ipad2.