Although Apple iphone6 ​​was released after a large number of users, it did not affect its sales in the global market in the second half of the year. It is said that this year's sales will reach 90 million units. However, behind Apple's performance, hundreds of suppliers around the world are rarely able to get rid of, and some Apple suppliers who have been in high spirits are now in a difficult situation.
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Scenery apples and helpless suppliers
Recently, some media reported that Apple's iphone mobile touch panel foundry Taiwan's Shenghua Technology Group's Dongguan Wanshida and Liansheng China have officially suspended production, and are actively seeking integration and restructuring. Among them, the Wanshida foundry in Dongguan has nearly 20,000 workers at the peak. It used to be the main manufacturer of touch panels in the Apple iPhone4 era, and is a leader in the global touch panel field. However, with the upgrade of Apple's new iPhone technology, iPhone5 and iPhone6 ​​also replaced the touch panel suppliers, resulting in a sharp decline in orders for Apple's OEMs, and lost operating losses.
As the saying goes, "with the king like a tiger", as the designated supplier of Apple, many foundries have always relied heavily on Apple orders. While enjoying the aura of Apple brand endorsement, the foundry is also facing the fate of being abandoned by Apple at any time. In order not to be kidnapped by suppliers and improve the bargaining power of foundry, Apple has found nearly a thousand suppliers around the world, and constantly puts a variety of critical requirements on suppliers.
According to Apple's previously published data, in 2013 Apple had 793 suppliers worldwide, including 349 suppliers in mainland China, ranking first in the world; Japan and the United States ranked second and third respectively, but Japan has dropped from 148 to 139, while the United States has shrunk from 75 to 60.
In fact, Apple suppliers are in trouble or even bankruptcy. In the case of the Shenghua Technology Incident, Apple Sapphire partner US GT suddenly announced the company’s bankruptcy in early October this year because Apple originally planned to promote GT for its production. The sapphire screen, but in the end did not use the sapphire screen on the iPhone6, so the GT company's new foundry was forced to close, leaving Apple's only big customer GT company and finally had to file for bankruptcy protection.
The same case as GT, as early as 2011, has happened to Japanese LCD panel giant Sharp. At the time, Apple had provided Sharp with $1 billion to build the iPhone 4 LCD display factory. Later, due to the unsatisfactory sales of the iPhone 4, Sharp was eventually forced to suspend the production line.
What warnings did Apple's supplier fail to give us?
Although Apple's mobile phone is currently the best-selling and most profitable consumer electronics product in the world, Apple's profit for the foundry link is small. Take iPhone profit distribution as an example. South Korea, the United States and other suppliers accounted for 4.7% and 2.4% respectively. Labor costs in China only accounted for 1.8%, while Apple accounted for 58.5% of profits. Among Apple's nearly 1,000 suppliers worldwide, suppliers in mainland China account for nearly half of the total, and most of them are based on assembly and processing. The supply of genuinely technical parts is often distributed to Japanese and Korean companies.
Take Foxconn, Apple's largest foundry, as an example. The profit margin of Foxconn's parent company and Taiwan-listed company Hon Hai Precision dropped from 5.9% in 2006 to 2.0% in 2012. This downturn is especially serious after Apple introduced the iPhone and iPad series in 2007. On the one hand, it is the sharp decline in the compensation for foundry, on the other hand, the sharp increase in labor costs. In order to maintain the normal operation of foundry enterprises, OEMs like Foxconn are very strict in controlling the operating costs, so that they are often called by the media. For the "sweatshop" behind Apple.
Although three of the top five global smartphone shipments are from China, most of the true core technologies and patents of smartphones are in the hands of technology giants such as Apple, Samsung and Ericsson. Chinese mobile phone manufacturers are still only technology followers. All kinds of mobile phone foundries have not mastered many cutting-edge core technologies, so they are caught in a serious shortage of the voice of the big smartphone producing countries and mobile phone technology.
At present, the development of global information technology is changing with each passing day. In the era of technological innovation every three to five years, technology followers are always facing huge risks of technological innovation. The troubled Shenghua Technology is the result of the loss of huge orders due to the fact that touch technology cannot keep up with the pace of upgrading Apple products. Even the OEM giants such as Foxconn are still experiencing tremendous pressure. Recently, they have frequently rushed to enter the e-commerce and establish their own product brands to get rid of the kidnapping of OEM customers such as Apple.
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