Apple has made a decision based upon the reality and the choices laid out before it. It has decided to shift the supply chain from Foxconn to its previous provider Pegatron. The consequences of this bold move are yet to fully manifest themselves.
Things are all shook up at Apple Incorporated as some radical changes get under way. The business environment requires adjustments and realignments and so big commercial enterprises evolve with time. According to The Wall Street Journal, Apple has begun shifting most of its supply chain tasks from Foxconn to Pegatron. Named after Pegasus, the mythical winged horse, Pegatron is a force to be reckoned with despite existing on a smaller scale than Foxconn.
Especially, Apple’s iPhone will be manufactured by Pegatron from now onwards. This contending company has taken to making low cost versions of various tablets and smart phones. And these cheaper products have flooded the market. The new technological role playing by Pegatron is a heavy blow to Foxconn since it won’t be hogging the limelight in the future. Apple was looking forward to an expansion along with some risk-taking. So it made the quantum leap from one to the other.
One of the chief issues that became an alibi for this move was Foxconn’s manufacturing faults as regards the iPhone 5. It was a bit of a problem technology to assemble and there were quality control hassles on the way. This led Apple to return between five to eight million of the iPhones. There was mutual dissatisfaction on both ends. Foxconn began taking liberties in some matters which irked Apple Incorporated to no end. With Pegatron these snags and hitches are likely to disappear leading to smoother operations. The CEO of Apple, Tim Cook is the man behind this smart maneuver. He was looking for some way to get the company back to #1 again and Pegatron seemed the ideal midwife for delivering this success. In spite of the fact that Pegatron is less than a giant among organizations it has a history of mutually beneficial cooperation with Apple. This much needed release from the clutches of Foxconn comes as a welcome relief for Apple. It can now get on with business as usual.
When businesses fumble there are always consequences and once in a while a full scale disaster to boot. It is for this reason that Apple has decided not to place all its eggs in one basket. The over-reliance on Foxconn cost it a few bucks alright. So it’s hoped that its latest honeymoon with Pegatron spells vibrant financial health for both firms in the times which are yet to come.