Asked by Anonymous on July 29, 2011
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Do you think it's possible that Apple will use Pegatron instead of Hon Hai to manufacture the iPad 3? See all Questions

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  1. James Di Burro

    Answer by James Di Burro at 9:23 am PST on September 16, 2011

    This answer: Report

    Although Pegatron is an up and coming Taiwanese manufacturer, given that they are very young as a company (about 4 years old) and relatively small in size, it is doubtful that Apple could shift a substantial portion of their estimated $25B+ spend with Hon Hai to Pegatron in the near term. Most OEMs avoid outsourcing more than 20-25% of a manufacturers total revenue, and I’m sure Apple would find this a risk as well. Apple’s dramatic success with iPad and related ecosystem products creates an almost unique supply chain challenge: finding capable, cost effective contract manufacturers with the scale to absorb Billions in new revenue. Could Apple groom Pegatron or someone else such as Flextronics over the longer term? It’s possible, although most likely only as a second source to Hon Hai for risk mitigation and/or peak demand shaving purposes.

  2. Answer by Anonymous at 2:58 pm PST on July 29, 2011

    This answer: Report
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