iPad 2 Production Shortages Due to LCD and Speaker Issues?

Apple's first-quarter supply of the iPad 2 fell far short of demand, according to the researcher, saying production faced manufacturing difficulties, which combined with strong demand, led to short supplies of the device. The issues, according to sources, include quality concerns with liquid crystal display panels and production shortages of the new speaker.

The report plays down any potential impact from the Japanese earthquake and tsunami, noting that Apple executives were quickly on-site in Japan to secure the necessary components. Shortages do still exist, however, and Apple may be continuing to experience some tightness in its production lines even as it has agreed to increase the prices it pays to suppliers in order to ensure a steady flow of parts.

Based on the light first quarter iPad sales and lingering production capacity issues, IHS iSuppli has lowered its 2011 iPad shipment forecast by nearly 10%, from 43.7 million units to 39.7 million units. The firm had boosted its projection to that 43.7 million figure back in October 2010 as it responded to booming demand for the first-generation models.