Who’s To Blame for iPhone 5 Shortage?

Sharp has denied it is the source of the much-discussed supply shortage of displays used in Apple’s (NASDAQ:AAPL) iPhone 5, saying it was making “adequate volumes” of the key component. The comments will ease worries of analysts concerned about Apple not being able to meet the high demand for its latest smartphone. The executive spoke in Osaka, western Japan, on the condition that he wasn’t identified.

According to Reuters, Sharp had fallen behind production schedule at its Kameyama plant in central Japan last month and was struggling to improve yields. Apple is also said to be sourcing the new in-cell touch panel display from Japan Display and LG Display (NYSE:LPL). The new display combines two layers into one, allowing Apple to lower the width of the new smartphone.

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The iPhone 5 began selling on September 21, and while Apple reported having sold more than 5 million units in the first three days, the company said later that it was working hard to meet the high demand and would have to delay some pre-orders to October.

According to a report by Deutsche Securities analyst Yasuo Nakane, the screen is hard to manufacture. “The iPhone 5′s four-inch low-temperature polysilicon touch-panel display with in-panel switching is exceptionally difficult to produce at high yields,” the analyst said in a report earlier this month.

Nakane estimates Japan Display and LG Display are able to manufacture eight million units of the screens a month each, while Sharp makes six million.

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