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Samsung could demand Apple pay penalty for not buying enough iPhone displays
According to ET News, Samsung is upset that Apple isn’t ordering enough iPhone displays. Now, Samsung is looking to financially penalize Apple for not meeting that order quota, which could mean a hit of hundreds-of-millions of dollars for Apple.
Apple, unsurprisingly, is trying to come up with an alternative solution.
The iPhone X, launched in 2017, was the first iPhone from Apple to feature an OLED panel. Samsung is far and away the world’s biggest supplier of OLED displays, so Apple had little choice but to get those panels from Samsung. The iPhone XS and XS Max also have Samsung displays.
Allegedly, Apple and Samsung entered an agreement in 2017 that saw Samsung give Apple better pricing on panels with the understanding that Apple would buy a certain number of panels over the next few years.
However, with iPhone sales dropping significantly over the past year or so, Apple hasn’t met the original order quota. As such, Samsung thinks Apple should be penalized.
This isn’t simply a case of Samsung being greedy. Apparently, Samsung invested millions in redesigning manufacturing plants specifically to meet Apple’s expected needs. It doesn’t seem fair for Samsung to make those investments for nothing.
Apple is attempting to renegotiate the deal by offering to buy more panels from Samsung for different products, such as laptops and tablets. If this pans out, we could see an OLED iPad or MacBook Pro sometime in the near future. However, Samsung might not agree and want the cash instead.