In an exclusive report Friday Reuters reported that Sharp's Kameyama plant in Japan has cut their production of the 9.7-inch Apple iPad screens. Spokespeople for Sharp didn't give a definite reason for the 40% decline in production leaving many to speculate. Could simply be as one analyst has suggested a post-holiday slump? Could Apple products be losing out to its competition? Is there just more demand for the smaller iPad mini? Or might it be something else all together?
"The March quarter is almost always weaker than the December quarter," said Shaw Wu, analyst for Sterne Agee, adding that Apple also consolidates suppliers of certain components during quarters with weaker demand. "The Korean manufacturers are more efficient and typically have lower costs."
The Korean manufacturers he refers to in the statement are LG and Samsung, who also make a share of the screens for iPads and some of Apple, Inc other mobile devices. LG carries the largest share of production and hasn't seen a decline suggesting that Mr. Wu might be making an accurate analysis of the situation.
Since the latest version of the iPad lacks the wow factor of the previous iPad3 with its retina display it could be speculated that people are sticking with the iPad3 instead of purchasing the iPad4. Another reason that could have also turned people is there has been more competition entering the 10-inch tablet market with both Microsoft and Google coming out with their own branded tablets.
With the popularity of the Kindle Fire last year Apple came out with their own smaller tablet called the iPad mini. It might be that since the people that would normally be rushing out to buy the latest full-sized iPad have decided that since Apple sees a future in the smaller tablet market that they are opting to go with the mini instead of its large brother.
It is also possible that it is none of the above it could be that the market place is just too flooded with tablets and Apple is just the first company to see the temporary downturn.
For more on the downturn in the iPad screen production you might read the following: