Apple appears set to discontinue production of 15-inch LCD iMacs, reports Taiwanese IT Web site, DigiTimes.

The story claims Apple wants to reduce its on-hand inventory stock, and introduce 17-inch models across the range.

Sales of the product have been slower than expected, attributable to a global PC market slump, and component-shortage-driven high prices. Apple expected to sell a million units in 2002, but sales are predicted to be half of that. The report says 15-inch iMac production has shrunk to just 20,000 a month – against a monthly request of 100,000 issued in January.

The iMacs are assembled by Apple's local contractors Quanta.

The unit takes 100 steps to assemble, the report claims, making manufacture costly. Apple is negotiating for lower costs in order to make future price cuts possible. In response, Quanta has shifted iMac assembly to China, for cheaper labour in that market.