According to the report, Nintendo is increasing world wide output of the Nintendo Switch by 2 million SKUs per month. The output will work in connection with attempting to meet demand with increased supply.
Digitimes is reporting that suppliers have acknowledged that Nintendo has been putting in more orders for parts, and this will first help balance out demand in various Asian regions. This rings especially true in Japan where the supply of the console has been so limited that thousands of people take part in a lottery in order to get an opportunity at getting one, as reported by Nintendo Everything.
The increase in production is also designed to coincide with two other very important milestones: the holiday season in North America and the launch of the Nintendo Switch in Taiwan taking place in December later this year.
Digitimes is also reporting that the increase in production has caught the eye of original design manufacturers such as Pegatron and Wistron, who have been putting in bids to take over production of the Switch units from Foxconn and Hosiden, both of whom have been in charge of over 50% of the Switch’s manufacturing supply.
Pegatron has been especially aggressive given how close they are to Nintendo’s Japanese headquarters.
Nintendo suffered from major supply constraints earlier in the year due to suppliers favoring Apple over Nintendo since both the Switch and the iPhone use the same parts. Apple took priority over Nintendo, resulting in a vast shortage of NAND chips and DRAM, components that were required to make the Switch but were in short supply. In result, Nintendo lost several months to the PS4 after the Switch launched due to not being able to get units out of the door.
By June they began increasing production and promised they would have enough supply to meet demand during July and August, which they managed to do. Since then Nintendo has been winning the monthly NPD, trumping both Sony and Microsoft’s respective PS4 and Xbox One.
Nintendo, however, is already looking ahead.
The company has signed a partnership deal with Tencent to release a big name game on the Switch in China. The increased production rates will also carry through to 2018, where Nintendo is hoping to establish an install base of 20 million before March, 2018.
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