Sharp cuts iPad screen output, say sources

Jan 20 2013, 20:50 IST
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SummarySharp Corp has nearly halted production of 9.7-inch screens for Apple Incís iPad, two sources said, possibly as demand shifts to its smaller iPad mini.

Reiji Murai & Miyoun Kim

Sharp Corp has nearly halted production of 9.7-inch screens for Apple Incís iPad, two sources said, possibly as demand shifts to its smaller iPad mini. Sharpís iPad screen production line at its Kameyama plant in central Japan has fallen to the minimal level to keep the line running this month after a gradual slowdown began at the end of 2012 as Apple manages its inventory, the industry sources with knowledge of Sharpís production plans told Reuters.

Sharp has stopped shipping iPad panels, the people with knowledge of the near total production shutdown said. The exact level of remaining screen output at Sharp was not immediately clear but it was extremely limited, they said. Company spokeswoman Miyuki Nakayama said, ďWe don't disclose production levels.Ē Apple officials, contacted late in the evening after normal business hours in California, did not have an immediate comment. The sources didnít say exactly why production had nearly halted. Among the possibilities are a seasonal drop in demand, a switch to another supplier, a shift in the balance of sales to the mini iPad, or an update in the design of the product. Macquarie Research has estimated that iPad shipments will tumble nearly 40% in the current quarter to about eight million from about 13 million in the fourth quarter, although Appleís total tablet shipments will show a much smaller decrease due to strong iPad mini sales.

Apple shares

Any indication that iPad sales are struggling could add to concern that the appeal of Apple products is waning after earlier media reports said it is slashing orders for iPhone 5 screens and other components from its Asian suppliers. Those reports helped knock Apple's shares temporarily below $500 this week, the first time its stock had been below the threshold mark in almost one year. Apple, the reports said, has asked state-managed Japan Display, Sharp and LG Display to halve supplies of iPhone panels from an initial plan for about 65 million screens in January-March. Apple is losing ground to Samsung, as well as emerging rivals including Chinaís Huawei Technologies Co Ltd and ZTE Corp.

No big change at other makers

In addition to Sharp, Apple also buys iPad screens from LG Display Co Ltd, its biggest supplier, and Samsung Display, a flat-panel unit of Samsung Electronics. Both LG Display and Samsung Display declined to comment. A source at Samsung Display, however, said there had not been any significant

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