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Slideshow Sharp's output of new iPhone displays lagging: source Tweet Share this Email Print Related News Uncertainty over Hon Hai deal frustrates Sharp investors 12:12am EDT CORRECTED-UPDATE 2-Investors sell off Sharp shares on Hon Hai uncertainty Thu, Aug 30 2012 Hon Hai chairman leaves Japan without deal on Sharp: media Thu, Aug 30 2012 UPDATE 4-Hon Hai, Sharp may spend over $1 billion on Japan plant Thu, Aug 30 2012 Sharp's Taiwanese savior in waiting shows off his Japan prize Wed, Aug 29 2012 Related Topics Tech » By Reiji Murai OSAKA | Fri Aug 31, 2012 4:36am EDT OSAKA (Reuters) - Sharp Corp has fallen behind schedule on production of screens for Apple Inc's latest iPhone just weeks before a planned major launch, a source told Reuters on Friday. The Japanese display maker is struggling with high costs that have cut into its margins on the screens, raising the question of whether Apple might provide financial incentives to speed up production, the source said. The source, who is familiar with Sharp's production operations, did not give an indication of how far behind the output had fallen. The source spoke on condition that he not be identified because of the sensitive nature of the disclosure. Sharp President Takashi Okuda said on August 2 that his company would begin mass production and shipments from its Kameyama LCD plant in central Japan this month. The facility is widely known to make screens for Apple, but Sharp has declined to acknowledge that Apple is a customer. Kameyama "is operational," Sharp spokeswoman Miyuki Nakayama said, without giving details of either output or shipment levels. Apple, which is also tapping other suppliers such as Japan Display and South Korea's LG Display Co for displays, is planning a major product launch on September 12. That has raised expectations the latest iPhone model will be in stores soon. The new iPhone screens will be thinner than previous versions with the use of so-called in-cell panels. The new technology embeds touch sensors into the liquid crystal display, eliminating the touch-screen layer found in current iPhones. Sources earlier told Reuters that the panels will extend 4 inches corner to corner -- 30 percent bigger than current iPhones. Sharp's shares slid 13 percent on Friday to 198 yen as uncertainty swirled around talks with Hon Hai Precision Industry for the Taiwanese company to buy a 9.9 percent stake in its fellow Apple supplier. (Additional reporting by Tim Kelly in TOKYO; Editing by Chang-Ran Kim and Ken Wills) Tech Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. 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