Apple supplier Luxshare is reportedly trying to break into iPhone manufacturing ahead of schedule, a move backed by Apple and aimed at challenging Taiwanese rival Foxconn, the world's leading assembler of Apple's iconic devices. The trouble with Pegatron reported yesterday could possibly open that door for Luxshare.
Luxshare has reportedly dispatched a group of employees to study iPhone production at a Chinese plant it is in the process of buying from Wistron, according to Nikkei Asia sources familiar with the matter.
The sources also claim that Luxshare is studying production of the latest iPhone 12 mini instead of older iPhone models as first reported. In fact, the report goes one step further claiming that the new Luxshare plant is reportedly in charge of roughly 20% of total orders for the iPhone 12 mini. Luxshare is said to be working with Wistron in making the latest iPhone 12 mini in Kunshan.
Luxshare's move to station staff in the iPhone assembly plant before of the deal has closed is a sign of how quickly Apple hopes the Chinese company can get up to speed and begin production.
Luxshare is attempting to become just the fourth iPhone assembler alongside Foxconn, Pegatron and Wistron -- and the first based in China. For Apple, increasing the number of assemblers gives it more bargaining power in setting prices and other conditions.
Luxshare, which nurtures ambitions of becoming the Chinese Foxconn, also plays a major role in Beijing's ambition of achieving greater self-reliance amid the U.S.-China tech war. Luxshare is one of the key companies to receive government subsidies, including from Beijing's 147.2 billion yuan fund established in late 2019 to improve the nation's manufacturing capability, Nikkei Asia reported earlier. For more on this, read the full Nikkei Asia report.