The world’s top contract manufacturer, Taiwan-based Foxconn, is responsible for approximately one-third of total iPhone 5c volume and now the company is allegedly winding down handset production at its factory in Zhengzhou, northern China, and shifting capacity to the flagship iPhone 5s, according to “industry sources” who spoke to DigiTimes, an industry publication with a mixed track record.
The story somewhat corroborates last week’s article by a Chinese blog which said another iPhone 5c manufacturer, Pegatron, slashed iPhone 5c production significantly because the flagship iPhone 5s was selling better to early adopters than the iPhone 5c, which is basically the last year’s iPhone 5 repackaged in colorful cases…
Foxconn and Pegatron Technology have obtained OEM orders for 30 percent and 70 percent, respectively, of iPhone 5c production, the sources said.
One month ago, Apple lowered iPhone 5c orders to Pegatron by 20 percent and those to Foxconn by nearly one-third for the fourth quarter due to unsatisfactory sales, the sources indicated.
Foxconn’s huge Zhengzhou production and assembly facility employes a whopping 120,000 workers.
C Technology (via UnwiredView), a Chinese blog, last week claimed Pegatron cut iPhone 5c production from 320,000 units per day in October down to just 80,000 units per day. The blog also mentioned that Foxconn had been operating at a minimum capacity of 8-9,000 units per day.
A month ago, the Wall Street Journal first reported that Apple would cut iPhone 5c orders. The financial newspaper put its usual Apple-is-doomed spin on the development arguing that the supply cut was due to the “weaker-than-expected demand and Apple’s pricing strategy for the device”.
In reality, this is but one of the many possible explanations.
As Apple’s been churning out the iPhone 5 for a year, its commissioned manufacturers are now capable of building large quantities of the mid-range iPhone 5c in a short period of time. And it’s expected Apple would want to make room for new devices such as the iPhone 5s, whose availability has been affected by limited production of the sophisticated and sensitive Touch ID fingerprint sensor.
Apple adjusting iPhone 5c output levels isn’t a surprise: the device began as a slow burner. Therefore, sales are expected to pick up at a later stage, once iPhone 5s demand cools off.
Do you own (or know somebody that owns) an iPhone 5c?