Foxconn Facing Display Shortages as it Struggles to Meet iPhone 6 and 6 Plus Demand

[bbeagle]

Am I the only one who knows that most of this is by design on Apples end? Human beings tend to always want what they can't have...so by making supply shorter, it creates a mini panic and people who were on the fence suddenly HAVE to have it. It's simple psychology. The day apple meets demand on launch day is the day people start saying "Eh, maybe next year". Fantastic marketing.

Take a look at Playstation and Xbox launches..they do the same thing. All intentional to drive demand higher.

So should Apple release the iPhone 6 on October 19th when they have enough made to meet demand? What would be your solution?

 

[winston1236]

540,000 units a day. 200,000 workers.
That's 2.7 iPhones a day quota per person.
Doesn't sound like a very efficient assembly line to me.

Assuming that every employee is only assembling which is unlikely.

 

[Gregintosh]

That seems like some very small numbers when the demand for the plus is probably going to be north of 20 million in the US alone.

That may be true but that 20 million will be split between the two phones, and not all 20 million will line up on launch day (unless you think each Apple store will get an average of 75,000 people lining up around the block... Though I never did see estimates or data on people lining up before).

What this means is that if you line up even just a few hours early your chances are good of getting one especially if you're buying for a less popular carrier in your area, where as if you just turn up at 5 PM they may be all gone.

 

[bbeagle]

540,000 iphones a day and you can't meet preorders for one night? The numbers don't add up.

4 million pre-orders = 8 days of making iPhones. Add this to the number of iPhones Apple needs in their stores and retailers stores on launch day, and it's about 3-4 weeks of making iPhones. Plus, they all can't be made at the same rate because of suppliers need to get their parts in.

They can't do more than that - all the software needs to be pre-loaded. They can't start making phones 3 months ahead of time.

The numbers DO add up, you just haven't thought it through.

 

[winston1236]

Does this mean I shouldn't wake up super early Friday and try to get one?

If you live in a small town you will probably have no problem getting one.

 

[gnasher729]

My launch day 128GB iPhone 6 plus is quoted to worth a double of the retail price (USD2,064) in the secondary market. It is so hard for me to keep it. I guess I will sell it.

Personally, I think someone offering that money is an idiot. There is no reason for you not to sell to an idiot for that price.

 

[DudeDad]

The delays are all because of the one guy who took a few phone backs....

 

[Mike MA]

True? Maybe! News? No.

 

[gavroche]

I think Apple vastly underestimated the demand for the Plus. According to many polls I've seen it's almost 50/50 but they are producing A LOT less. Screen yields aside, it seems they simply underestimated demand.

Don't think you can just put screen yields aside. Remember, it was rumored and a possibility that the 6+ would launch later, due to yield issues. Apple opted to launch both together. None of us is in any position to know what Apple estimated.

 

[MrX8503]

Am I the only one who knows that most of this is by design on Apples end? Human beings tend to always want what they can't have...so by making supply shorter, it creates a mini panic and people who were on the fence suddenly HAVE to have it. It's simple psychology. The day apple meets demand on launch day is the day people start saying "Eh, maybe next year". Fantastic marketing.

Take a look at Playstation and Xbox launches..they do the same thing. All intentional to drive demand higher.

I would disagree because 4M preorders in 24hrs is double the preorders the iPhone 5 had. By your logic, Apple would have held back.

 

[heisenberg123]

1 Million workers in China.

Imagine if Apple assembled the iPhone in the U.S. and its shareholders were willing to accept lower profits. Instead of insisting on a cash-stash of $200 billion, what would have been so wrong with a cash-stash of, say, $110 billion? And if every major corporation did that for the U.S.?

If that had happen, the supply chain -- which has now shifted to China -- would have not disappeared from the U.S. Remember, the U.S. had that supply chain before but it was left to languish because of the chase for maximum profits, without heed for any responsibility of maintaining local manufacturing jobs.

Look, I realise there's a lot of ways to justify why having a national debt of $17.5 trillion is ok, because it allows U.S. corporations to maximise shareholder profits.

But consider this: historically there is such a phenomena as entire empires going down sink hole because the majority of people in that culture thought in the same rut, and could not see what was happening to their own culture, because their concepts appeared to be the norm because everyone around them thought the same way. For a nation to disintegrate, there has to be a critical mass where suddenly the majority of people buy into the destructive concept. Then collectively the civilisation drowns like a frog in the kettle.

some Major corporations are not american and actually are based out of Asia so they would have an unfair advantage over their competetors in America

 

[foodog]

Plus every app on that 6 plus will look like a blown up mess in the upcoming days ahead.

Great guess at something you haven't seen yet... Seems the reviewers who have seen it contradict your guess.

 

[gnasher729]

540,000 units a day. 200,000 workers.
That's 2.7 iPhones a day quota per person.
Doesn't sound like a very efficient assembly line to me.

That's not how it works.

They could be working 24/7. 168 hours a week. 4 workers each working 42 hour weekly shifts. So at any point in time, only 50,000 are working. Number goes up to 10.8 phones in one person's working day.

And there will be lots and lots of steps to build one iPhone. 45 minutes to build an iPhone from scratch isn't bad. Remember, it's being built from lots and lots and lots of tiny individual parts.

 

[gavroche]

If these reports are true, the 6+ screen yield rates are about 50%. Assuming over 90% yields on the 6 screens leaves us with about half as many 6+ phones as 6 phones. That sounds like they estimated the demand right but didn't anticipate the yield rates correctly.

Or they also had an idea what yields would be as well... and were faced with two options: Delay launch of the 6+, or have supply shortages. Either option results in angry consumers and conspiracy theories unfortunately.

 

[waytena]

3 sizes for 6?

Anyone notice the three different screen sizes in the pic for iPhone 6? Haha, one can only wish. Would love if they had a 4 inch screen size available in the 6. 4.7 is just too darn big. 128 GB is a must though

 

[MentalFloss]

And in a few years Apple will bring production of the iPhones to the US because automation will make it cheaper to assemble here than to assemble in China and ship them.

I strongly doubt that. As far as I know, the main reason for assembling iPhones in China is that most of the components are built in China, and bringing them to the US would not only be a major logistical issue, but also a major issue for import taxes.

 

[foodog]

I would disagree because 4M preorders in 24hrs is double the preorders the iPhone 5 had. By your logic, Apple would have held back.

It is mind boggling how people keep claiming Apple is restricting quantities to increase demand... and selling more devices year over year at launch.

 

[heisenberg123]

That's not how it works.

They could be working 24/7. 168 hours a week. 4 workers each working 42 hour weekly shifts. So at any point in time, only 50,000 are working. Number goes up to 10.8 phones in one person's working day.

And there will be lots and lots of steps to build one iPhone. 45 minutes to build an iPhone from scratch isn't bad. Remember, it's being built from lots and lots and lots of tiny individual parts.

and they get 1 hour paid lunch and two 20 minute breaks

42 hours a week? people work longer than that in first world countries

I would say they are working about 70 hours a week

 

[granolatx]

Hope I get mine...

I just hope I get mine this Friday. It still says Preparing for Shipment. It's Wednesday! I love to track my phone over the Arctic Circle to Alaska.

 

[gnasher729]

Apple should just send out build it yourself kit.

Do-it-yourself kit for $299. If you don't manage to build it or get it working, they fix it for $699 by giving you a brand new iPhone.

 

[Keirasplace]

Which story? The story of the shortages, or Apple's use of supply and demand to create free advertising of the iPhone 6 to make others' demand higher? (It's the girlfriend effect, the best way to get a girl to notice you, no matter how ugly you are is to have a beautiful woman that looks like your girlfriend, at your side)

No company on earth would do that. So, this is totally imaginary. They don't need to create shortage, there will be by the very fact that can't start production 6 months in advance to make sure they have enough to cover all orders until the end of december.

Companies usually don't like to have tens of billions of assets lying around in storage. Not to mention this would cut short their R&D time for all the parts and software.

 

[gnasher729]

So horrible to say but very true, I remember watching a video on one of the Foxconn factories and people would line up like crazy as if there was a new ride opening up at an amusement park. If people keep coming back and wanting to work there then there must be something positive to it.

Like highest wages in the area, cheap food and accommodation available, clean working conditions...

 

[alexgowers]

I don't see why this is surprising or indeed avoidable? It's just how it is.

You can't predict demand, you don't want to over egg it and have left over stock.

If apple could supply all the demand worldwide they would, it's just not possible to release it on a single date and indeed they don't even manage that.

I wonder what happens with other manufacturers, maybe they rely on releasing many models and public confusion.

 

[Michaelgtrusa]

1 Million workers in China.

Imagine if Apple assembled the iPhone in the U.S. and its shareholders were willing to accept lower profits. Instead of insisting on a cash-stash of $200 billion, what would have been so wrong with a cash-stash of, say, $110 billion? And if every major corporation did that for the U.S.?

If that had happen, the supply chain -- which has now shifted to China -- would have not disappeared from the U.S. Remember, the U.S. had that supply chain before but it was left to languish because of the chase for maximum profits, without heed for any responsibility of maintaining local manufacturing jobs.

Look, I realise there's a lot of ways to justify why having a national debt of $17.5 trillion is ok, because it allows U.S. corporations to maximise shareholder profits.

But consider this: historically there is such a phenomena as entire empires going down sink hole because the majority of people in that culture thought in the same rut, and could not see what was happening to their own culture, because their concepts appeared to be the norm because everyone around them thought the same way. For a nation to disintegrate, there has to be a critical mass where suddenly the majority of people buy into the destructive concept. Then collectively the civilisation drowns like a frog in the kettle.

I'm with you here as many here and all over the US can't see what has happened to the US and who's behind it. What did the founders fight for? the very thing that's happening now, trillions of dollars of infrastructure move to a totalitarian system based on the British system that controls the US economy, the debt is fake, the true is more like 1 billion. China has no technology, china is a technology transfer including military tech. Those hi tech jobs would send trillions through the US tax base.

 

[agsystems]

No company on earth would do that. So, this is totally imaginary. They don't need to create shortage, there will be by the very fact that can't start production 6 months in advance to make sure they have enough to cover all orders until the end of december.

Companies usually don't like to have tens of billions of assets lying around in storage. Not to mention this would cut short their R&D time for all the parts and software.

And...they will get hammered by Wall Street - if the numbers do not balanced out - you cannot have the holiday quarter with 120M and then the rest drop down to 10-20m....