“Apple Inc. has notified its two assemblers for the low-cost iPhone 5C that it is reducing orders of the smartphone for the fourth quarter, people familiar with the situation said, raising concerns about weaker-than-expected demand and its pricing strategy for the device,” Lorraine Luk and Eva Dou report for The Wall Street Journal. “[At launch] customers’ attention focused on the company’s high-end phone, the iPhone 5S, which offers faster chips and new features including a fingerprint sensor despite being about $100 more expensive than the iPhone 5C. Demand for a new gold-colored version was particularly high during its initial debut, causing Apple to increase orders for that device.”
“Apple told its Taiwanese assemblers Pegatron Corp. and Hon Hai Precision Industry Co. that shipments of the iPhone 5C in the fourth quarter would be cut, the people said,” Luk and Dou report. “Pegatron, which analysts say assembles two thirds of the iPhone 5Cs, was told orders would be cut by less than 20%, said a person familiar with the matter. Hon Hai, which assembles the remaining low-cost iPhones, was told orders would be cut by a third, said two people familiar with the matter.”
“Apple notified the suppliers it was reducing iPhone 5C orders earlier this month, the people said. Hon Hai has also stopped hiring additional workers to produce the iPhone 5C due to order cuts from Apple, an executive said. In September, a Hon Hai executive had said the company would be beefing up its workforce, anticipating strong orders for the iPhone 5C,” Luk and Dou report. “At the same time, Apple has also raised orders for the high-end iPhone 5S for the fourth quarter, two executives at Hon Hai said. While Apple’s Asian supply chain is widely interpreting the cuts as proof of slack demand for the iPhone 5C, component orders don’t correlate directly with end demand. Apple has also previously cut component forecasts to suppliers over the past years.”
Read more in the full article here.
MacDailyNews Take: iPhone 5c is simply not “low cost.” Why the WSJ and others insist on describing it incorrectly is baffling.
And, Ben Bajarin is correct:
Despite what we hear about the 5S vs. the 5C, I maintain that the time for the 5C is early to mid 2014. When the late majority move.
— Ben Bajarin (@BenBajarin) October 16, 2013
Related articles:
Apple cuts iPhone 5c orders for Q4, says source – October 16, 2013
Why would anyone buy an iPhone 5c instead of an iPhone 5s? – September 10, 2013