It is being reported that Quanta has begun cutting production lines for the BlackBerry PlayBook at their northern Taiwan facility. The reason for the cut back is said to be due to a decrease in orders for the PlayBook. Quanta is reported to offer preferential compensation to lay off about 1,000 workers.

RIM chose to use Quanta and their Taiwan facility to thwart imitations of the PlayBook by China-based white-box vendors. Quanta then set up production lines at the factory in northern Taiwan specifically for the PlayBook and began production in three shifts with a workforce of more than 2,000 staff, the DigiTimes report said.

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Forecast sales of the PlayBook had it 4 to 5million PlayBooks in 2011. However, only 800,000 shipped in the first half of 2011. With drastically shrinking ODM orders from RIM, Quanta quickly decided to downsize its production to minimize losses. It is not clear if RIM will withdraw from the tablet market.