Apple Could Be Forced To Ditch BOE As A Display Supplier, With A Letter Sent To The U.S. Department Of Defense Stating That Such Firms Pose A Security Risk

A long-term alliance between Apple and BOE could come to an end because of a letter that was reportedly sent to the U.S. Department of Defense, claiming that China’s display suppliers pose a security risk to the country. Assuming that the executive branch of the federal government acts based on what the letter recommends, the iPhone maker will have to stop procuring panels from the manufacturer.

BOE is reportedly a supplier of Apple’s low-cost iPhone SE 4 launching early next year; strict action could annul this business relationship

Despite being used as a backup supplier for Apple’s high-end products or a primary display provider for low-cost devices, BOE is still an integral part of the Cupertino firm’s supply chain, and it risks getting severed from the list if the letter is approved. According to The Select Committee On The CCP, Chairman John Moolenar has written to Defence Secretary Lloyd Austin about China’s subsidization of display makers. The letter that was spotted by AppleInsider has targeted the likes of BOE and Tianma, claiming that such companies could become a national security threat.

“Chairman John Moolenaar (R-MI) of the House Select Committee on the Chinese Communist Party wrote to Defense Secretary Lloyd Austin about the growing threat to U.S. economic and national security posed by Chinese state-subsidized LCD (liquid crystal display) and OLED (organic light emitting diode) companies, BOE Technology Group and Tianma Microelectronics Co..

While LCD and OLED are common technologies found in televisions and similar devices, Moolenaar highlights the technologies’ critical role in our own weapon systems and notes that BOE and Tianma have accumulated large amounts of the global display market through state subsidies, posing a supply chain risk for our military. Moreover, Moolenaar exposes BOE and Tianma’s deep connections to the People’s Liberation Army through their parent companies and participation in military-fusion zones in China.”

Moolenaar requests the relevant authorities to view BOE and Tianma as a threat and place them on the DoD 1260h blacklist as Chinese military companies. If both manufacturers appear on that list, it will be next to impossible for them to trade with U.S. companies such as Apple. The iPhone SE 4, which is said to enter mass production in October, is said to feature OLED panels from BOE after the latter successfully outbid Samsung by providing Apple with a lower quote.

Apple was already looking to expand its relations with BOE to achieve better price leverage over Samsung and LG, but this letter can change the iPhone maker’s supply chain landscape. Now, we have to wait and see how the DoD actually evaluates this letter.

News Source: The Select Committee On The CCP

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