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Hon Hai to be sole supplier of next iPhone

TAIPEI -- Taiwan's Hon Hai Precision Industry Co. will be the sole assembler of Apple Inc.'s next iPhone model, helping its total iPhone shipments grow by 13 percent in 2014, according to Deutsche Bank AG.

“We believe Hon Hai will be the sole assembly supplier for the new model given its sufficient manpower and flexible capacity for mass production,” Andrew Chang, a Taipei-based analyst at Deutsche Bank, wrote in a note to investors dated Dec. 17.

Exclusive production of the new iPhone, expected to have a 4.8-inch display and be launched in the third quarter of 2014, will help Hon Hai increase its total iPhone shipments, including the iPhone 5S and 5C, by 13 percent next year to 140 million units despite Apple's multiple-supplier strategy, the bank said.

Hon Hai, also known as the Foxconn Technology Group in China, received 79 percent of Apple's iPhone orders in 2013, with the remaining 21 percent allocated to rival Taiwanese contractor Pegatron Corp., according to the bank's estimates.

But Hon Hai's share of the iPhone business will fall in 2014 to 74 percent, compared with a 23 percent share for Pegatron and the remaining 3 percent share for a new entrant, Taiwan-based Wistron Corp., the bank predicted.

For iPad assembly orders, Hon Hai's current 69 percent share is expected to drop to 63 percent next year as another new entrant, Taiwan's Compal Electronics Inc., gets a 7 percent share, according to the bank.

Pegatron's 31 percent share of the iPad orders will hold at about 30 percent in 2014, the bank said.

Hon Hai shares rose 1.02 percent to close at NT$78.9 (US$2.66) in Taipei on Wednesday, beating the 0.05 percent fall in the broader Taiwan stock exchange index.

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