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Apple looking beyond Foxconn for low-cost iPhone manufacturing, says WSJ

Apple looking beyond Foxconn for low-cost iPhone manufacturing, says WSJ

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Taiwanese manufacturer Foxconn has become nearly synonymous with Apple's products, but that may not be the case for much longer. According to The Wall Street Journal, Apple is increasingly splitting its manufacturing between Foxconn and little-known company Pegatron. Pegatron was tasked with making a limited number of iPhones and a significant portion of iPad minis. Now, WSJ says the company will be the primary builder of a new, low-cost iPhone, which has been heavily rumored in the past months.

Pegatron has had a long relationship with Apple, packaging its first-generation iBook computers. The company has survived an acquisition by Asustek and a subsequent spin-off, and now it's attempting to increase its prominence as a supplier. According to anonymous sources, Apple is making the switch for a number of reasons. The iPhone 5, manufactured by Foxconn, was prone to scuffs and scratches, causing Apple to crack down on quality control. Unlike Jobs, who enjoyed a close relationship with Foxconn's Terry Gou, Cook is reportedly more interested in diversifying. Foxconn, meanwhile, has reportedly been attempting to move beyond its status as a manufacturer, potentially looking at its own line of branded accessories.

If Pegatron becomes better known as an Apple supplier, it could eventually see the same scrutiny as Foxconn, which has been criticized for its treatment of workers and for a spate of suicides over the past few years. Pegatron was investigated along with Foxconn and other manufacturers during a series of audits in 2012, but it has largely escaped the public outrage against Chinese factory conditions. In late 2011, allegedly "hours" after an Apple inspection, a blast struck a Pegatron factory in Shanghai, injuring 59 workers. It was blamed on a build-up of dust, particularly from the aluminum polishing process.