The third layer comprises the contract manufacturers which assemble the final product. Inventory management, which allows Apple to maintain a just-in-time production model, is often controlled by the final assemblers themselves such as contract manufacturers Foxconn and Pegatron. The second layer consists of vendor-managed inventory players that sort, store and ship the components to final assemblers. The first layer includes component suppliers that make parts such as camera sensors, displays and batteries as well as vibration motors, sensors and speakers that go inside the iPhone. The Apple supply chain, which CEO Tim Cook is credited with having put in place, has three layers. Plus, it is a much smaller player as compared to Foxconn and Pegatron,” said one of the executives.ĭoing just the final assembly at a time when components had to be procured from multiple regions became difficult, especially during the pandemic. “There need to be systems in place to gauge demand and ship to various units, which Wistron lacked. It has tried to negotiate with Apple for higher margins, but being a smaller player as compared to Foxconn and Pegatron globally, it did not have the necessary leverage,” said an executive.įoxconn and Pegatron are engaged in inventory management for Apple in India, but Wistron wasn’t able to get into the high-margin business. With the company having stopped iPhone assembly in China after selling its Kunshan unit to Luxshare in 2020, the India business became too small for it to focus on.Īlso, “Wistron has not been able to make any money from the Apple business in India.
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