Apple factory explosion could compound iPad supply difficulties

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Apple factory explosion could compound iPad supply difficulties

Warwick Ashford

An explosion at one of Apple's main suppliers' factories that killed three people and injured 15 could affect the availability of iPads.

Apple last month said it was working through "the mother of all backlogs" for iPad supply. Some analysts predict the latest setback could compound the iPad supply problem.

The Hon Hai share price dropped 5% in Taiwan and Foxconn's was down nearly 6% in Monday trading, while Apple's shares closed down 1.6% in New York on Friday, after news of the explosion emerged, according to the Financial Times.

But according to Chinese news reports, production at Foxconn, a subsidiary of Taiwan-based Hon Hai Precision, is expected to resume as early as this week.

Even a one-month delay at the Foxconn plant would affect fewer than 1.3m units, which would reduce revenue by less than $800m, the paper said.

Apple has come under fire for working conditions at some of its suppliers and the explosion could highlight workplace safety issues at the Foxconn factory.

Preliminary reports indicate the explosion was caused by the combustion of dust that had built up in the factory. Apple could face fresh criticism for failing to identify the hazard through inspections.

'Prison-like' conditions for workers making IBM, Dell, HP, Microsoft and Lenovo products >>


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