Production slump in iPhones
This is how Apple solves its China problem
By Jannik Tillar
11/27/2022, 6:17 p.m
Anyone hoping for an iPhone 14 Pro under the Christmas tree will be disappointed. Apple’s top model will not be available before January 2nd. There are also bottlenecks with MacBooks. The zero-Covid chaos at the supplier in China is to blame. Apple is adapting. Consumers can too.
If you want to give away an iPhone for Christmas, you have to come up with something this year. The reason is delivery problems at the second largest cell phone manufacturer in the world, Apple. A black iPhone 14 Pro, the classic, will only be available again in the Apple shop from January 2nd. And it’s the same with other retailers.
But where do the problems that hit Apple in the important Christmas business come from? The short answer is: China – the country where Apple produces most of its products. The supplier Foxconn in particular is causing problems for the Californians here, or more precisely: the Chinese government’s strict zero-Covid policy.
Production deficit apparently at 30 percent
Recently there have been massive protests against the “barracking” of employees – pictures of fleeing demonstrators went around the world. And that’s how it happened that Apple admitted delivery problems for the first time three weeks ago. The plant in the Chinese city of Zhengzhou is currently working “at reduced capacity”.
The result: “Our customers will have to accept longer waiting times to receive their new products,” the manufacturer said. According to Reuters, the production deficit was about 30 percent until recently. Apple has so far left unanswered a question about how this has affected Germany so far.
There was rioting again this week. Videos on social media on Wednesday showed hundreds of Foxconn employees tearing down barriers and clashing with people in hazmat suits, according to Reuters. Police officers with batons and plastic shields tried to push people back. Clashes ensued. You could also see how some workers were lying on the ground, apparently injured.
Customized strategy
Thousands of employees have now left the factory. Foxconn even promised employees higher wages if they chose to return. But the measure has not been really successful so far. And the fewer people work for Foxconn, the fewer iPhones are made.
This is another reason why Apple has already been working on the strategy: Because capacities are limited, models that are in high demand, such as the iPhone 14 Pro, are mainly produced. Here, Apple increased production from 50 to 60 percent of the total – also because the Pro version has a higher margin. The less popular iPhone 14 Plus, a larger version of the iPhone 14, is manufactured less, but is still available.
In general, if you still want to put a new iPhone or MacBook under the Christmas tree at Christmas, you should keep an eye on cheaper models. For example the standard iPhone 14 or its predecessor, the iPhone 13. Apple often delivers them the very next day.
This article first appeared on Capital.de.