Cracks are appearing in the once unbreakable relationship between Apple and its main manufacturing partner Hon Hai Precision, as the Silicon Valley company switches more work to a rival contract manufacturer.
Pegatron, which like Hon Hai is based in Taiwan, has been winning contracts for popular Apple products such as the iPhone 4S and the iPad mini at a time when Hon Hai was focusing on the launch of the iPhone 5.
This shift was reflected in the two manufacturers’ results for the most recent quarter. Revenues at Hon Hai, better known by its trade name Foxconn, suffered its biggest decline in more than a decade, falling by 19 per cent year-on-year to T$809bn ($27bn). Meanwhile, Pegatron’s revenues rose 31 per cent to T$195.27bn.
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