Apple has asked suppliers to build as many as 90 million next-generation iPhone handsets this year, a sharp increase from iPhone shipments in 2020, according to those in the know.
The Cupertino, California-based tech giant has maintained a steady level of around 75 million units for the first run from a device’s launch through the end of the year over the past few years. The improved 2021 forecast suggests that anticipating the first iPhone launch since the rollout of COVID-19 vaccines will drive additional demand. The next iPhone gadgets will be Apple’s second with 5G, a major temptation driving users to upgrade.
This year’s update will be more incremental than last year’s iPhone 12, with an emphasis on processor, camera and display improvements, people said, asking not to be named as the plans are not public. Apple plans updates for all current models, for the 5.4-inch and 6.1-inch regular versions and the 6.1-inch and 6.7-inch Pro models. The phones, codenamed D16, D17, D63 and D64, are all expected to be announced in September, ahead of last year’s October release, thanks in part to the recovery of the supply chain.
At least one of the new versions will have an LTPO (Low Temperature Polycrystalline Oxide) screen that can vary the refresh rate based on the content displayed. Apple has been using this technology in the Apple Watch for several years now, which can cause the screen to be slower in certain situations — such as Always On mode — to conserve battery life. Oppo, OnePlus and Samsung Electronics. already have LTPO displays in their flagship phones. The new iPhone devices with LTPO screens will also use IGZO (indium gallium zinc oxide) technology for improved energy efficiency and responsiveness.
While the design of the new Apple phones will remain largely unchanged, the company plans to reduce the size of the front camera and the cutout for the face unlock sensor, or notch, to better match its rivals. The company hopes to eventually remove the notch completely in a future version of the iPhone and is likely to shrink further next year.
An Apple spokesperson declined to comment.
Apple’s camera upgrades will emphasize more advanced video recording features, such as improved optical zoom. An upgraded system-on-chip, built around the same six cores as the current A14 chip, will also be included. The company has tested an in-display fingerprint scanner for this year’s devices, but that feature is unlikely to appear on this generation.
Although Apple has asked suppliers to build up to 90 million units, the actual number could be a few million units below that target, one of the people said. Huawei’s sanctioned smartphone business is a key factor in Apple’s increased shipping orders, according to another person familiar with the strategy.
The ongoing chip shortage that has undermined operations in several global industries is not expected to affect production of upcoming iPhone handsets, some people said. Apple is the main chipmaker of Taiwan Semiconductor Manufacturing Co.’s largest customer, and its large orders make the launch of a new iPhone an annual event that suppliers across Asia plan months in advance.
Shares of TSMC rose a staggering 1.3 percent after the report on Apple’s improved production plans. Among other supply partners, Taiwanese connector and powerpack manufacturer Cheng Uei Precision Industry climbed a whopping 9 percent and lens maker Largan Precision climbed a whopping 2.4 percent. The Japanese electronic component manufacturer Alps Alpine rose no less than 3.5 percent.
Chinese assembly partner Luxshare Precision Industry will play a bigger role this year after it acquired iPhone assembly facilities from Wistron.
Assembler Hon Hai Precision Industry Co. will dominate orders for the 6.7-inch Pro Max model, splitting the 6.1-inch Pro with Luxshare and the 6.1-inch regular iPhone with Pegatron. Pegatron is expected to make all 5.4-inch units.
In addition to the new iPhone models, Apple is preparing several other products later this year, including new MacBook Pro laptops with custom Apple chips, redesigned iPad mini, and entry-level iPad and Apple Watches with updated screens. Apple plans to start production of the new MacBook Pro in the third quarter after experiencing some issues related to MiniLED displays that also put the launch of the latest iPad Pro to the test.
To solve the MiniLED supply problem, Apple has hired Luxshare to split the orders for an essential MiniLED part for the new MacBook Pro with Taiwan Surface Mounting Technology, which previously dominated orders for the part for iPad Pro.
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