Apple supplier hiring 40,000 'to build new iPhone' The Chinese firm is an assembler of Apple's iPhone and iPad and, said it would increase its number of workers in China by up to 40 per cent in the second half of the year, fuelling market speculation of a new cheaper iPhone. A supplier source in Japan said small-scale production of the display panel for the model would begin in May, ramping up to mass production in June. Apple is widely expected to launch the cheaper version of the iPhone in the third quarter, although some analysts have expressed doubts that Apple would change its approach so radically. Pegatron President and Chief Executive Officer Jason Cheng told an investor conference on Wednesday that revenue from communication products would contribute up to 40 per cent to total in the six months from June, compared to 24 per cent in the three months in the beginning of the year, local media reported. Pegatron posted a 81 per cent surge in net profit in the first quarter from a year earlier to T$2.31 billion (£50 million), while its operating margin improved to 0.8 per cent from 0.3 per cent in the previous quarter. "Making the cheaper iPhone will further help Pegatron's operating margin because its plastic casing is easier to make than iPhone 5's metal casing; this should ensure a good yield rate," said Fubon Securities analyst Arthur Liao. Liao added a higher yield rate would also be bring an edge to Pegatron's profitability over Hon Hai Precision Industry, the major supplier to Apple.