Production of Apple's iPad 2 tablet PC has been hit by an explosion at a Foxconn plant in Chengdu, China where the device is manufactured.
Market researcher RBC Capital on Sunday forecast that the blast could reduce production of the iPad 2 by as much as 2.8 million units, causing a shortage in the second half of this year.
The explosion in a block of the plant left two workers dead and 16 injured. Chinese police say it may have been caused by mishandling of a polishing chemical during the manufacturing process, but they are not excluding the possibility of arson.
There have been numerous complaints of poor working conditions at Foxconn, and 14 workers have committed suicide since last year. The company decided to suspend operations of the plant until a joint investigation with Apple is finished.
An analyst at RBC Capital said that the explosion could reduce production of the iPad by 1.3 million to 2.8 million out of around 8 million shipments slated for the third quarter, and cause sales losses reaching as high as US$1.7 billion.
