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Apple Reportedly Looking to Pegatron to Pick Up Foxconn Slack

by Brandon Russell | May 29, 2013May 29, 2013 4:00 pm PDT

Apple Store Logo 2

Apple is slowly weening its reliance on Foxconn as it looks to more evenly distribute its supply chain, according to a report from The Wall Street Journal. The Cupertino-based company has tasked Pegatron, a smaller Foxconn rival, to pick up the new workload—Pegatron could potentially manufacture Apple’s fabled affordable iPhone, the report says.

Over the last few years, Foxconn has been Apple’s favorite child, depended upon to get through heavy orders of iPads and iPhones. And for all the Chinese manufacturer’s follies, Apple has continued to stick by the company because it always produced results. Then the iPhone 5 happened, which Foxconn said was the hardest device it has ever had to develop, so Apple is looking elsewhere to ensure dependence isn’t put too squarely on one company’s shoulders.

With Apple potentially moving into wearable technology, and expanding its iPhone line, the move reeks of strategy; Apple declined to comment, of course. The WSJ claims Foxconn doesn’t quite have the scale it used to as it improves factory conditions, though that’s not what is driving Apple away. Foxconn has allegedly become “difficult for Apple to control” the feeling is reportedly mutual between the two companies.

The presence of Tim Cook has also lead to big changes in Apple’s culture, with Cook “putting a greater premium on risk diversification,” according to sources. This actually isn’t the first time Apple and Pegatron have worked together. In an earlier incarnation of the Taipei-based manufacturer, some ten years ago, the company allegedly packaged Apple computers by candlelight.

According to Pegatron, the company is expected to grow its workforce by up to 100,000 employees, leading some to believe it’s all in preparation for Apple’s low-cost iPhone. Whatever the case, Apple is keen to create distance between itself and Foxconn, thus ending what was previously one of tech’s steamiest relationships.


Brandon Russell

Brandon Russell enjoys writing about technology and entertainment. When he's not watching Back to the Future, you can find him on a hike or watching...