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iPad 2 Supply Problems Loom: IHS iSuppli

York – The multiple disasters now rocking Japan could cause component supply
problems for Apple’s iPad 2, according to IHS iSuppli.

teardown analysis of the device identified at least five parts sourced from
Japanese suppliers, including difficult to replace components such as the
electronic compass and the ultra-thin lithium-ion battery manufactured only by
Apple Japan, an Apple subsidiary.

battery cells are made at the site of assembly but because the iPad 2’s
lithium-ion polymer battery is unusually thin, it likely requires advanced
battery cell manufacturing technologies that reside in Japan,” said Wayne Lam,
senior analyst, competitive analysis, at IHS iSuppli.

disruptions may mean that Apple could have difficulties obtaining this battery,
and it may not be able to secure supply from an external, non-Japanese source.

Japan-manufactured components include the iPad 2’s NAND flash made by Toshiba,
DRAM from Elpida Memory, the e-compass from AKM Semiconductor and the
touchscreen overlay glass from Asahi Glass.

some of these suppliers reported that their facilities were undamaged, delivery
of components from all of these companies is likely to be impacted at least to
some degree by logistical issues now plaguing most Japanese industries in the
quake zone. Suppliers are expected to encounter difficulties in getting raw
materials supplied and distributed as well as in shipping out products. They
also are facing difficulties with employee absences because of problems with
the transportation system. The various challenges are being compounded by
interruptions in the electricity supply, which can have a major impact on
delicate processes, such as semiconductor lithography,” the report said.

issues may come at a time when Apple is rushing to ramp up iPad 2 production to
meet stronger-than expected demand for the device. The company this week
announced that iPad shipments from the Apple Store have been delayed by one
week from previous lead times because of the surge in demand.

iSuppli’s complete Apple iPad 2 teardown, see:

Generation Apple iPad 2 with A5 Processor