Apple, here’s how Covid will slow iPhone 14 deliveries
The Cupertino giant warns: possible delays in the shipment of the iPhone 14 Pro and Pro Max due to Covid restrictions in China
Restrictions for Covid in China dampen Apple's sales prospects for the year-end holiday season.
On November 6, the Cupertino giant said it expects lower-than-expected shipments of the iPhone 14 Pro and iPhone 14 Pro Max (launched in September) and that customers will have to wait longer to get the new models. Apple has admitted that the production of the iPhone 14 Pro assembly plant in Zhengzhou, the largest in the world in the Chinese province of Henan, has been hit hard by the restrictions against Covid-19.
"The facility (which is of Taiwanese Foxconn ) is currently operating at significantly reduced capacity," the Cupertino-based company said in a statement.
The move will have a significant impact on Apple's quarterly sales and make it harder for consumers to get their hands on Apple's high-end models, Axios comments. The iPhone contributes half of Apple's global sales, and the December quarter is typically the most profitable period.
Last month, Reuters reported that iPhone production could decline by up to 30% in November at the Foxconn plant in Zhengzhou due to restrictions due to Covid-19. We have seen many employees fleeing the factory, which employs around 200,000 people, due to discontent with the strict measures imposed by the authorities.
All the details.
LESS IPHONE 14 PRO AND PRO MAX
Apple said on Sunday it will ship fewer iPhone 14 Pro and Pro Max smartphones than expected. “We continue to see strong demand for the iPhone 14 Pro and iPhone 14 Pro Max models,” reads the note from the Cupertino giant.
BLAME OF COVID-19 RESTRICTIONS IN ZHENGZHOU
But due to Covid-19 restrictions in a plant in Zhengzhou, China, manufacturing production is "significantly reduced".
Specifically, Apple said that factory is the main facility for making the pro models and added that it "works closely with our supplier to return to normal production levels, while ensuring the health and safety of each worker".
WHAT HAPPENS IN CHINA
On Monday, China recorded the highest number of new COVID-19 infections in six months, with the disruption of the world's second largest economy spreading nationwide since October. Over the weekend, health officials said they would stick to the strict limits of the coronavirus, disappointing investors hoping for an easing.
Analysts warned of worsening outages ahead of winter after more than three-quarters of major Chinese cities reported new Covid cases in October.
THE EXPECTED NUMBERS
"The restrictions on the factory are affecting what was already a reduced production and limiting the offer of the two most requested iPhones," said Carolina Milanesi, analyst at Creative Strategies, to the FT.
Although Apple has repeatedly claimed that restrictions from Covid-19 caused billions of dollars in supply problems during the pandemic, it has not issued such a warning outside of earnings calls since February 2020, notes the Financial Times .
And last week, market research firm TrendForce reduced its iPhone shipping forecast for October-December by 2-3 million units, from 80 million, due to factory problems, adding that its investigation found capacity utilization rates around 70%.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/apple-ecco-come-il-covid-rallentera-le-consegne-di-iphone-14/ on Tue, 08 Nov 2022 06:45:55 +0000.