Apple Plans to Repurpose GTAT Sapphire Glass Factory

GT Advanced Technologies is shutting down the Mesa, Arizona factory where it produced synthetic sapphire glass for Apple, but the iPhone and iPad maker has different plans. Apple told city officials it plans to repurpose the factory which will save some jobs, but hasn't said yet exactly what the factory will make next.

Apple plans to repurpose GTAT's sapphire factory in Mesa, ArizonaApple plans to repurpose GTAT's sapphire factory in Mesa, Arizona

GTAT said it was shutting down the factory as part of its Chapter 11 bankruptcy plan, and that it was laying off over 700 employees. The bankruptcy followed the company's failure to meet Apple's sapphire glass production requirements.

GTAT signed a deal with Apple about year ago to produce synthetic sapphire glass for the Apple Watch, iPhone 6 and iPhone 6 Plus. The company wasn't able to follow through on its commitment, leading to spiraling expenses, missed deadlines, and ultimately bankruptcy. The company previously called Apple's terms "oppressive and burdensome."

Apple agreed to front US$578 million in a series of payments so GTAT could ramp up its sapphire production. Apple also bought and leased factory space to the company to house the furnaces needed to produce the glass. Apple still owns the factory and the land it sits on, and it is letting GTAT stay in the facility through the end of the year rent-free.

GTAT will be selling the sapphire furnaces Apple financed so it can repay the loan, which will open up the factory for whatever it produces next. Apple plans to be involved in that new operation, at least on some level.

"They've indicated their commitment to us," Mesa City Manager Christopher Brady said. "They want to repurpose that building and use it again."

Apple had planned on buying up more land around the factory, according to Bloomberg, but it isn't clear if that's still on the table. Mesa has designated property in the area as a foreign trade zone, which brings with it hefty tax incentives — up to a 70 percent reduction. If Apple has plans for some sort of expanded production facility, that tax break could be an enticing factor.

There isn't any word on how many jobs Apple will be able to save since no one knows yet what the company has planned for the factory. Despite the layoffs going into the holiday season, Mesa city officials are hopeful for a positive outcome.

"Apple could've invested in a facility literally anywhere in the world," Mesa Mayor John Giles said. "There's a reason they came here, and none of those reasons have changed."