Foxconn Struggling To Meet iPhone Demand

 

  • Shipments are insufficient
  • Attributed to the iPhone 5 design
  • Affecting Apple’s shares

Taiwan’s Foxconn has admitted that it is having a hard time trying to catch up to the huge demand for Apple’s new iPhone 5.

 

  • Shipments are insufficient
  • Attributed to the iPhone 5 design
  • Affecting Apple’s shares

Taiwan’s Foxconn has admitted that it is having a hard time trying to catch up to the huge demand for Apple’s new iPhone 5.

"We can't really fulfil Apple's requests. Our shipments are insufficient given the huge market demand," says Foxconn chairman Terry Gou.

Hon Hai Precision Industry, popularly known as Foxconn, is the world’s largest maker of electronic components. The company has been deeply involved in manufacturing many of Apple’s key products. Foxconn also makes other products by other firms such as Nokia, Intel and Sony.

When the iPhone 5 launched in September this year, it gained a whopping number of 2 million pre-orders within 24 hours after the launch. There have also been 5 million iPhone 5’s sold over its launch weekend.

According to Gou, the design of the iPhone 5 has made the production difficult but he did not elaborate. He declined to say whether Foxconn plans to outsource some of the iPhone orders to other makers.

“The issues with the new iPhone stem from the fact it is thinner than prior versions, and any time you reduce the thickness you’ve got much less room to work with and you increase the likelihood for manufacturing error,” says IHS senior principal analyst Tom Dinges.

“The manufacturing process for the iPhone is still relatively high on labour as opposed to automation, which also increases the likelihood for manufacturing issues when you shrink the size of the device.”

On October 25, Peter Oppenheimer, Apple's Chief Financial Officer, said that demand for the iPhone 5 continued to outstrip supply, but it was working hard to catch up. The lack of supply has hurt the company’s shares in recent weeks due to concerns that it might not be able to meet demand.

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