Apple supplier Foxconn warns that component shortages will last until 2022

The Verge

March 30, 2021

The ongoing global shortage for electronic components continues, and Foxconn — which handles manufacturing for Apple, among other major tech heavyweights — has announced that it’s starting to see the impact of shortages. According to Young Liu, Foxconn’s CEO, the company won’t be able to fulfill some of its orders due to those shortages, which he expects will last until at least the second quarter of next year, Nikkei reports.

“The [supply in the] first two months of this quarter was still ok, as our clients are all very big, but we started to see changes happening this month,” Liu reportedly told investors during the company’s latest earnings call.

The impact of the shortages isn’t expected to be large, at least for now: Liu expects that the company will only miss around 10 percent of its orders due to part shortages, citing the large order volumes of its customers. But it’s still a notable miss for Foxconn — and by extension, its customers like Apple — who may be forced to contend with delays.

Foxconn also saw slowdowns in manufacturing last spring at the height of the COVID-19 pandemic, following mandatory government shutdowns and quarantined factory workers. Those delays trickled down across the supply chain, leading to a later-than-usual November launch for Apple’s iPhone 12 lineup. The current slowdown, by comparison, seems less drastic, but if parts continue to be hard to get, delays could mount later in the year.

Foxconn is the latest company to call out the ongoing chip and component shortage that has slowing down production of everything from next-generation consoles to cars. Earlier this month, Samsung warned its investors of a “serious imbalance” in the semiconductor industry as it prepares to deal with the ongoing global chip shortage. Car companies like Ford, Volkswagen, Nissan, and Toyota have have had to slow truck and car production due to a surfeit of silicon. Both Sony and Microsoft have both cited part shortages as major factors in the near-impossible-to-buy status of the PlayStation 5 and Xbox Series X. And the aftermarket value of PC graphics cards has doubled, even tripled, due to a combination of unprecedented shortages and demand.