Ben's Blog World: Apple supposedly cutting iPhone 5c production in half due to low demand

Friday, October 11, 2013

Apple supposedly cutting iPhone 5c production in half due to low demand

Apple may be cutting production of the iPhone 5c in half due to demand being lower than expected. Sources say that production is currently at 300,000 units a day and will be cut down to 150,000 units a day. According to CTechnology, poor demand is due to the higher than expected price and the iPhone 5s outselling it.

While it is very possible that Apple wrongly estimated demand for the iPhone 5c, we also have to keep in mind that it's also a much easier phone to produce than the iPhone 5s. The iPhone 5s has a more complicated assembly paired with newer and harder to produce components that can easily bottleneck the supply chain, the M7 chip in particular is most likely causing issue.

This creates a problem wherein people assume Apple grossly underestimated demand for the iPhone 5s and overestimated demand for the iPhone 5c.

The iPhone 5c was never made to compete with the iPhone 5s. I also don't think Apple was naive enough to expect the iPhone 5c to sell even a small fraction of the amount of units the iPhone 5s sold at launch. We've already talked about why we think the iPhone 5c will sell well and I think most of us here at iMore still stand behind that.

While soft initial demand may be the case for the iPhone 5c, it's a phone that didn't face the same constraints as the iPhone 5s so comparing the two probably doesn't provide the most accurate overall picture. Apple will sell a good amount of iPhone 5c units, but those units will be sold over a spread out period of time to users who are out of contract and upgrading and don't want to pay $200 or more for a smartphone. That is the audience the iPhone 5c is aimed at. Not those of us who want the latest and greatest in bleeding edge technology. For us, there was the iPhone 5s.

It'll be interesting to see how the iPhone 5c does over the holidays and in the coming months as demand for the iPhone 5s catches up and production of both models can level out.

Source: CTechnology via cnet