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iPad 2 May Face Supply Woes After Japanese Quake

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iSuppli, the company responsible for thorough product teardowns of Apple (s aapl) products, reported Thursday that the Japanese earthquake could affect iPad 2 supply volume, since at least five components from that device are likely sourced from Japanese suppliers, including a few hard-to-replace parts.

The specific parts iSuppli has been able to identify as mostly likely sourced from Japan include NAND flash from Toshiba Corp., DRAM from Elpida Memory Inc. and touch screen overlay glass for the display likely made by Asahi Glass Co. The battery (from Apple Japan Inc.) and electronic compass (from  AKM Semiconductor) are also produced by Japanese suppliers, and are so specialized they could be quite hard to replace from suppliers located elsewhere.

Other components may have been sourced in Japan besides those identified above, but the teardown process isn’t always capable of identifying the country of origin of all parts, iSuppli cautioned. It also noted at least a few of Apple’s Japanese suppliers reported that their facilities didn’t sustain any damage as a result of the earthquake, but that problems with logistics and other factors could still affect the supply chain at those facilities.

iSuppli also noted that semiconductor facilities in Japan, at least, can’t recommence full production until all aftershocks have stopped. According to Dale Ford of IHS, which acquired iSuppli in 2010:

Earthquakes ranging from 4 to 7 on the Richter scale will make it impossible to really restart these fabs until the earthquakes stop happening with such frequency. Every time a quake tops 5, the equipment automatically shuts down.

Apple can find alternate sourcing for NAND memory, including South Korea’s Samsung corporation and the U.S.-based Micron Technology (s mu). Samsung can also provide the DRAM, but when it comes to the other major Japanese-made components, finding a suitable replacement may not be so easy.

The electronic compass found in the iPad 2 is apparently calibrated very specifically to work with the tablet’s accelerometer and gyroscope, and is highly sensitive to electromagnetic interference. According to IHS, this means it can’t just be swapped out for a similar product from another manufacturer.

The glass used to protect the iPad’s touchscreen is thought to be the new Asahi Glass Dragontail product, which is stronger than the glass used in the original iPad. If Asahi is indeed the supplier, it would pose problems, because the company has reported damage to three of its facilities in Japan. Since the glass is a proprietary product, sourcing alternatives might lead to variances in quality.

Finally, the iPad 2’s battery, while labeled as “assembled” in China,” looks to actually be made by Apple’s Japanese subsidiary. IHS Senior Analyst Wayne Lam explains why Apple may have had to stick with in-house manufacturing for this particular component, making it difficult if not impossible to have it built elsewhere:

Typically, 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.

Obviously, iPad 2 supply levels are the least of Japan’s worries right now, but this could mean that Apple will have trouble meeting customer demand in the U.S., and might even lead to a general postponement of the international launch of Apple’s latest tablet. Apple’s share value dipped earlier on the week, due partially to supply fears, and while prices recovered yesterday, this latest report won’t do much to allay those fears, either. We reached out to Apple for comment, but have yet to hear back.

6 Responses to “iPad 2 May Face Supply Woes After Japanese Quake”

  1. We’ve got 10,000 dead over here, number climbing. Nearly half a million displaced and in shelters. No gas, food, water, electricity, medicine, gasoline for the millions of people still living in their homes in the stricken area. Supplies cannot get in because of how badly road and rail is damaged. Oh, and a reactor or two that they can’t get supplied with enough cooling water.

    And you guys are worried about the supply of #$)%(‘# ipad parts???

    That’s cold.

    Tokyo, Japan

  2. *reached out to apple*
    hope you didn’t hurt yourself.
    is this what journalism has come to?
    whatever happened to apple refused to comment, could not be reached for comment, did not return calls seeking comment, had no comment, declined to comment?
    you guys must be terrified of steve jobs; why?

  3. Wow, the experts had spoken Apple will face supply problem, give me a break.

    I don’t believe Apple do not have a backup plan for supplies and only short sighted people and very mentally challenged to have ONLY one supplier for components in their products.

    If this is the way they do business they will be hold for ransom by the supplier and gouge through their nose.

    Sorry iSupply you guys have been lying for a long time and this time your mentally challenged faculty had surfaced.