Apple Preps New Manufacturing Plant in Arizona

Apple (AAPL) reportedly is readying a new manufacturing plant in Mesa, Ariz., to open later this month to make sapphire crystal coverings for future iPhone and iPod displays, camera lenses and fingerprint readers, and perhaps the vendor’s long-rumored iWatch.

According to reports in the Arizona Republic and 9to5Mac, Apple has partnered with New Hampshire-based GT Advanced Technologies to make scratch-resistant sapphire crystal to use in its mobile devices. Last November, Apple said it was opening up a new manufacturing plant in Mesa and, in keeping with its closed-mouth nature, declined to say how the facility would be used—and also zipped the lips of others involved—leaving the whole deal a mystery, as the Arizona Republic reported at the time.

But in mid-December, 2013, the vendor solicited permission from the Foreign Trade Zone Board to fast-track approval of the production plant. Apple has code-named the initiative Project Cascade, and in its documentation described the end product as a “critical new sub-component of Apple Products to be used in the manufacture of the consumer electronics that will be imported and then sold globally. By pulling this process into the U.S., Apple will be using cutting edge, new technology to enhance and improve the consumer products, making them best in class per product type.”

According to the Arizona Republic, Apple received a $10 million grant from the Arizona Commerce Authority that sweetened the deal. Some 700 people are expected to work at the Mesa plant in a 1.3 million square-foot facility initially constructed by First Solar but was never used for manufacturing. GT, not Apple, will employ the workers.

“If you remember a year or so ago, Apple was looking to expand their administrative facilities,” said Scott Smith, Mesa mayor. “They eventually chose Austin, Texas, but Mesa was a finalist on that, so they were familiar with us and that familiarity helped us because when they came back into Mesa we didn’t have to start from scratch,” he said.

Apple bought the building for $113 million and will lease it back to GT. The vendor already has paid $1.06 million in impact fees to Mesa, as confirmed by Christine Zielonka, director of the city's Development and Sustainability Department, in the Arizona Republic report.

In a letter to the Board, James Patton, Apple Global Trade Compliance deputy director, said the vendor and GT want to “meet an aggressive go-live timeline of February of 2014,” 9to5Mac reported.

While Apple has patented a way to encase an iPhone display in sapphire crystal to make the device’s screen less prone to scratches, there’s buzz that the vendor may be hurrying the plant’s opening for its long-rumored iWatch. After all, what separates a quality watch isn’t simply its internal mechanisms but also its appearance, particularly the crystal’s ability to fend off dings and marks.