Apple Inc. (NASDAQ:AAPL) is experiencing a similar situation with its new iPhone 6 and iPhone 6 Plus—a limited supply to meet consumers’ demand for the products.
Foxconn Technology Co Ltd (TPE:2354), the main manufacturing partner of Apple Inc. (NASDAQ:AAPL) is confronting challenges to improve its production for the iPhone 6 and iPhone 6 Plus, according to report from the Wall Street Journal based on information familiar with the situation.
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In short, consumers would probably need to wait for weeks before receiving their new iPhone 6 and iPhone 6 Plus. Apple Inc. (NASDAQ:AAPL) received more than 4 million pre-orders within 24 hours for the new devices.
Foxconn Technology is hiring more workers
According to the sources, Foxconn Technology Co Ltd (TPE:2354) is hiring more workers to assemble the iPhone 6 and iPhone 6 Plus models at its largest factory in Zhengzhou, north central China.
The company has more than 200,000 workers in the factory, and it is dedicated only for manufacturing the new iPhones and key components such as metal casings. It has more than 100 production lines working 24 hours a day at the production site to meet the strong demand.
Foxconn Technology Co Ltd (TPE:2354) has more than one million workers in China.
Foxconn Technology is the sole assembler of iPhone 6 Plus
Foxconn Technology Co Ltd (TPE:2354) is experiencing difficulty because it is the sole manufacturer of the iPhone 6 Plus with 5.5-inch display, and it is responsible in producing the majority of the iPhone 6 with 4.7-inch display.
One of the sources familiar with the manufacturing situation said, “We have been churning out 140,000 iPhone 6 Plus and 400,000 iPhone 6 every day, the highest daily output ever, but the volume is still not enough to meet the preorders.”
The person added that Foxconn Technology Co Ltd (TPE:2354) is still ramping up its production line for the iPhone 6 Plus.
Another person explained that there is a shortage of 5.5-inch displays, which is one of the reasons behind the limited supply. The company’s output rate for the 5.5-inch display is only around 50% to 60%. The output rate for the 4.7-inch display is better at 85%.
Display production is complicated
The sources explained that the production of the iPhone 6 and iPhone 6 Plus is complicated because they are using in-cell technology in making the display for the new devices. The in-cell technology allows the production of thinner and lighter screens by integrating touch sensors into the liquid crystal display. With the technology, having a separate touch-screen layer is no longer necessary.