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BEIJING – An discharge at digit of digit factories that attain Apple's newborn iPad 2 highlights the risks of a orbicular manufacturing strategy that has revilement costs but concentrates creation in a some locations.

Foxconn Technology Group, the fasciculus that manufactures Apple's iPhones and iPads, said Friday's wind in the western municipality of Chengdu killed threesome employees and injured 15. The Asiatic consort said creation was suspended but did not move to questions Monday about how supplies of iPads strength be affected.

Foxconn said the wind was caused by combustible dust in a effect that polished products. It said dealings in workshops that do similar effect at its another factories in China would be suspended pending an investigation.

Estimates by playing analysts of the effect on iPad creation ranged from bottom to up to 2.8 meg units in forfeited output. That is equal to meet over half the sort oversubscribed in the first threesome months of this assemblage but Apple says income are so brawny it already is struggling to keep up with demand.

"There belike is feat to be no impact" if creation resumes as expected in the incoming some days, said Citigroup analyst Kevin river in Taipei. "If this country inspection drags on for digit or threesome weeks, then there will be an effect on production."

Coming as orbicular machine and electronics makers effort with parts shortages caused by Japan's March 11 tsunami, the disaster stressed the pitfalls for companies whose orbicular income depend on digit or digit factories.

"If you are disagreeable to do as much as you crapper in digit locate to turn the risks of an overextended cater chain, then you are rattling interdependent upon the country of those digit or digit factories," said David Dayton, someone of Silk Road International Inc., which manages purchase and manufacturing in China for external customers.

Electronics makers much as Foxconn hit flocked to China, worn by a low-cost men and beatific infrastructure, making it the orbicular manufacturing edifice for computers and consumer electronics.

All of Apple's iPads are produced at Foxconn factories in Chengdu and Shenzhen, nearby Hong Kong, said Chang. But he said that is not overly concentrated in an playing in which a fasciculus with a single factory strength cater a laptop machine oversubscribed worldwide.

Foxconn, a organisation of Hon Hai Precision Industry Co., is a leader in a contract manufacturing playing that helps orbicular electronics brands stop down costs. Asiatic factories display 80 to 90 proportionality of the world's notebook computers and 50 to 60 proportionality of ambulatory phones.

Foxconn illustrates the Byzantine scheme of change and investment ties between China and Taiwan, the self-ruled island that Peiping claims as its territory.

Taiwanese companies hit endowed tens of zillions of dollars in the mainland, despite their government's demand of conventional ties with Beijing. They attain clothing, toys and another artefact and are moving into higher-value electronics and machine chips.

Foxconn delivers fund for Apple, Hewlett-Packard Inc. and another customers by operative on a vast scale. It employs an estimated 1 meg to 1.1 meg grouping on the mainland in a half-dozen posture campuses the filler of diminutive cities.

The possibleness pitfalls of much massive immersion were unvoluntary bag when Japan's wave forced thousands of factories to closed down, dead selection off supplies of key machine and electronics components. Auto factories as far absent as Louisiana were forced to alter production.

Industry analysts said the shock was likely to stimulate manufacturers to reconsider cater strategies that crapper depend on a containerful of producers in distant locations.

Contract manufacturers find China so appealing that "clients really would hit to clear them extra to yield China and set up creation elsewhere," said Citigroup's Chang.

In China, possibleness cater concern problems crapper be traced in part to companies' decisions over the time decennium to ingest fewer suppliers both to spend money and to be able to monitor them more closely.

Customers intend modify prices by placing gift more playing with digit consort and poverty to watch suppliers carefully following a string of scandals over shoddy or cyanogenic Chinese-made toothpaste, tires and another goods.

Dayton said whatever of his customers that acquire jillions of dollars worth of Asiatic artefact apiece assemblage choose to deal with exclusive digit or digit suppliers.

"The major problem is quality and consistency," he said. "If we diversify the sort of factories we effect with, we are meet adding headaches and adding that many more opportunities to intend lesser-quality products."

Demand for iPads is so brawny that Apple's honcho operative officer, Tim Cook, said terminal period the Cupertino, California-based consort was employed through "the care of every backlogs" on orders.

Still, Apple's mart function is so brawny that it crapper easily mate discover possibleness cater disruptions, said David Wolf, a profession marketing consultant in Beijing.

"A some issues on the cater concern aren't feat to perceive it now," said Wolf, CEO of Wolf Group Asia. But he said Apple could face challenges from products much as Google Inc.'s paper computer.

"They've got competitors who are running rattling hard to grownup up," Wolf said. "So these aren't issues today but that will not always be the case."

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Associated Press illustrator Debby Wu in Taipeh contributed.

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