Monday, 19 November, 2018

After lacklustre response, Apple pauses production of the iPhone XR

Report: Apple cancels iPhone XR production boost Apple cancels iPhone Xr production boost
Nina Mathis | 08 November, 2018, 04:16

The iPhone XR, meanwhile, is having its demand outlook cut by around 20% to 25%, according to the Nikkei source.

A source familiar with the matter said: "for the Foxconn side, it first prepared almost 60 assembly lines for Apple's XR model, but recently uses only around 45 production lines as its top customer said it does not need to manufacture that many by now". At Foxconn, only 45 production lines of the planned 60 are now being used. Apple's willingness to raise its prices across the board is a testament to just how strong a product the iPhone X was. Weakened demand for smartphones globally might not hurt Apple's revenue too much, but suppliers could feel the strain.

"The utilization for the XR production is not reaching its maximum capacity now", sources told the publication. Far from it, it stands to reason that Apple during the current holiday quarter will see a huge boost in iPhone sales due to a wide selection of 3 brand new iPhone models.

Sources told the publication that Foxconn had initially prepared almost 60 production lines for the production of iPhone XR.

But, if Nikkei and its supply-chain sources are accurate on any level, it would appear that Apple's 2018 iPhone pricing strategy may be backfiring.




Specifically, Rosenblatt Securities Managing Director and top research analyst Jun Zhang foresees an iPhone X production ramp-up of between 1 and 2 million units for the holidays.

Apple's smaller supplier, Wistron, was reportedly told to eliminate all expectations of producing any iPhone XR parts. "The moves to add orders for year-old iPhone models while suspending extra production for the latest product illustrates Apple's lack of innovation and inability to energize consumers with such a pricing strategy".

Apple's market capitalisation (M-Cap) or market value slipped below the $950-billion mark as shares of the iPhone maker fell, news agency Reuters reported.

Maybe iPhone sales decline over time, or maybe Cupertino has something to hide.

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