Apple reportedly cuts fourth quarter iPad orders
News continues to pour out of Apple concerning its supply chain and the iPad, and reportedly, it’s not good news for the company’s suppliers.
Apple is cutting orders to vendors for its tablet computers, which will have a negative effect on suppliers such as Hon Hai Precision Industry, according to JPMorgan Chase & Co.
Numerous Apple suppliers have said over the past two weeks that the company slashed its fourth quarter iPad order by approximately 25 percent, an unprecedented move, JPMorgan said. The tech company could drop its fourth quarter orders from 17 million in the third quarter to 13 million.
JPMorgan U.S. analyst Mark Moskowitz, who works extensively with Apple, did not lower his projection of 10.9 to 12 million iPad shipments in the third and fourth quarters following the supply chain adjustments.
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Taipei-based industry analyst Wanli Wang of RBS Asia Ltd. thinks the reduced Apple iPad orders could be the case of a weakening demand in Europe due to uncertain economic conditions.
“It’s back to reality,” Wang said. “Not it seems even for Apple, due to the market situation, we need to be conservative.”
There has been no confirmation from Apple that it is reducing its fourth quarter order totals, but the scare was enough for the company to fall 2 percent on the Nasdaq Stock Market this morning.
Despite the concerns over Apple’s supply chain management, the company still accounts for close to 75 percent of tablet computer sales this year, dominating the marketplace.
Elon Musk's Boring Co. planning wider tunnels for freight
Elon Musk’s drilling outfit The Boring Company could be shifting its focus towards subterranean freight and logistics solutions, according to reports.
A Boring Co. pitch deck seen and shared by Bloomberg depicts plans to construct wider tunnels designed to accommodate shipping containers.
Founded by Tesla CEO Musk in 2016, the company initially stated its mission was to offer safer, faster point-to-point transport for people, particularly in cities plagued by traffic congestion. It also planned longer tunnels to ferry passengers between popular destinations across the US.
The Boring Co. completed its first commercial project earlier this year in April. The 1.7m tunnel system is designed to move professionals between convention centres in Las Vegas using Tesla EVs. It says the Las Vegas Convention Centre Loop can cut travel time between venues from 45 minutes to just two.
Boring Co.'s new freight tunnels
The Boring Co.'s new tunnel designs would allow freight to be transported on purpose built platforms, labelled as “battery-powered freight carriers”. The document shows that, though the containers could technically fit within its current 12-foot tunnels, wider tunnels would be more efficient. Designs for a new tunnel, 21 feet in diameter, show that they can comfortably accommodate two containers side-by-side, with a one-foot gap between them.
The Boring Co.’s new drilling machine, dubbed Prufrock, can tunnel at a rate of one mile per week, which is six times faster than its previous machine, and is designed to ‘porpoise’ - mimicking the marine animal by ‘diving’ below ground and reemerging once the tunnel is complete.
Tesla’s supply chain woes
Tesla is facing its own supply chain and logistic issues. The EV manufacturer has raised the price of its vehicles, with CEO Musk confirming the incremental hike was a result of “major supply chain pressure”. Musk replied to a disgruntled Twitter user, confused as to why prices were rising while features were being removed from the cars, saying the “raw materials especially” were a big issue.
Car manufacturing continues to be one of the industries hit hardest by a global shortage in semiconductor chips. While China’s chip manufacturing levels hit an all-time high in May, and the US is proposing a 25% tax credit for chip manufacturers, demand still outstrips supply. Automakers including Volkswagen and Audi have again said they expect reduced vehicle output in the next quarter due to a lack of semiconductors, with more factory downtime likely.
Top Image credit: The Boring Company / @boringcompany