Apple Inc. (Nasdaq: AAPL) may be diversifying its manufacturing partner lineup. According to the Website Engadget.com, Taiwan-based EMS company Pegatron Corp. will manufacture 50 percent to 60 percent of orders for Apple's upcoming tablet, dubbed the iPad mini. Apple reportedly has been developing a smaller, less expensive tablet computer for some time.
On its Website, Pegatron, based in Taipei, reports equity worth roughly $2.7 billion. The company says it is vertically integrated and supports a diverse base of products, including desktop PCs, notebooks, broadband, wireless systems, game consoles, networking equipment, set-top boxes, multimedia, and LCD TVs. The EMS provider was established in 2007 with the assets of Asustek Computer, and merged with Asusalpha Computer in 2008. In 2010, the company merged with Pegatron International Investment Co., Ltd. Pegatron is traded on the Taiwan Stock Exchange.
To date, reports Engadget.com, Foxconn Electronics Inc. has been the exclusive manufacturer of iPads.
There are a number of reasons why Apple would expand its manufacturing base. Record-setting orders of the iPhone 5 may test Apple's existing capacity. Depending too heavily on any one EMS partner is risky, so Apple may be spreading that risk by adding new subcontractors. Apple has also been embroiled in a PR nightmare because of Foxconn's alleged mistreatment of workers, but there is no indication Apple plans to disengage with Foxconn. If anything, according to Engadget.com, Apple may shift some iPhone 5 capacity over to Pegatron to ensure a steady supply of products.
Either way, Apple reports it is having problems delivering the new iPhones on schedule and some buyers may have to wait until October for their new devices.