Apple is famous for using low-cost Asian manufacturers for both sourcing and assembling it’s popular devices, but the consumer device monolith recently started receiving one critical component from a little closer to home… Texas.
Reuters reports that the A5 processor, the brain that runs the iPhone 4S and iPad 2, is now being made in a sprawling 1.6 million square foot factory in Austin, TX owned by friend / foe, Korean electronics giant Samsung Electronics, according to people familiar with the operation.
An excerpt from Reuters:
One of the few major components to be sourced from within the United States, the A5 processor is built by Samsung in a newly constructed $3.6 billion non-memory chip production line that reached full production in early December.
Nearly all of the output of the non-memory chip production from the factory – which is the size of about nine football fields – is dedicated to producing Apple chips, one of the people said. Samsung also produces NAND flash memory chips in Austin.
Samsung began supplying the A5 processors to Apple this year from the Austin plant.
Apple has declined to comment, saying it does not detail supplier relationships. A Samsung spokesperson declined to comment on its customers and specifications of chips manufactured in its Austin facility. But she said the company did expand the Austin factory to include a production line to make logic chips. The A5 is one such chip.
The A5 debuted in Apple’s iPad 2, and now also powers the iPhone 4S. The chip is twice as fast as it’s predecessor, the A4, which is also made by Samsung.
The great success of the iPad and iPhone devices has been a boost to the city of Austin, as Samsung has added about 1,100 jobs to support the new non-memory chip production lines. Samsung employs a total of 2,400 employees at its facility.
Austin is also home to an Apple customer call center that deals with customer complaints in North America, Apple’s biggest market.
Even though Apple is one of Samsung’s largest customers, they are arch-rivals in the smartphone and tablet marketplace. The two companies are also locked in an nasty patent infringement battle that covers both multiple countries and products.