Apple's sapphire glass supplier has filed for Chapter 11 bankruptcy with plans to shut down two production plants and lay off 890 workers. The supplier, GT Advanced Technologies (GTAT), says that it's burning through an unsustainable amount of money at the Arizona plant it opened with Apple just within the last year. In addition to requesting approval to shut down that plant, GTAT has also asked that a New Hampshire bankruptcy court terminate its agreements with Apple, which it describes in a filing as "oppressive and burdensome." GTAT intends to come out of the bankruptcy by restructuring around its core businesses, including selling sapphire furnaces.
It's not clear how disruptive this may be for Apple, which had clearly intended on making heavy use of this partnership to outfit its smartwatches and potentially its smartphones and tablets with this type of glass. Currently, Apple uses sapphire to cover the Touch ID sensor and certain camera lenses. But the most notable use of this material was still to come: Apple plans to use it to cover the face of many models of its smartwatch. Given that the Apple Watch doesn't have a specific release date yet, Apple has time to work around this — but it'll almost certainly disrupt what appeared to be masterful supply chain plans. Apple has other sapphire suppliers, but GTAT's plant would have given it a dedicated source of the material. Apple did not immediately respond to a request for comment.