Wednesday, October 16, 2013

Declining demand - Apple cuts orders for the iPhone 5C - Sü

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16 October 2013 18:52

Insufficient demand: The iPhone 5C

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Apple ordered from its suppliers for the iPhone 5C fewer components. This could be a sign of a weak demand for the lower-priced smartphone. The Group’s strategy unit now increasingly critical.

class=”moreInfo”> By Lorraine Luk and Eva Dou, Wall Street Journal, Germany

Apple has announced its contract manufacturers that orders will be reduced for iPhone 5C in the fourth quarter. The report, people familiar with the matter. Apparently the demand for the smartphone is weaker than expected, which raises the price strategy in question.

In September, Apple had to sell its two new iPhones in eleven markets, including the U.S., Germany and China started. The customer initially fell mainly on the higher-priced iPhone 5S, which offers faster chips and new features such as a fingerprint scanner, and about $ 100 cheaper iPhone 5C in the shade. The demand for a new gold-colored version was particularly high. Apple therefore had to increase its orders for this variant.

Now Apple has the Taiwanese supplier Pegatron and Hon Hai Precision Industry announced that deliveries of the iPhone 5C are reduced in the fourth quarter. Pegatron, which runs about two-thirds of all orders for the iPhone 5C, was told that the orders would be reduced by less than 20 percent, insiders report. Hon Hai, where the rest is produced must be clearly set on a one-third reduction.

a manufacturer of components for a reduction in orders for the iPhone 5C was also announced – by 50 percent. Analysts say that this could indicate a slowdown in vehicle sales in the coming year – or an inventory reduction in the pavers. A first Apple spokeswoman did not respond to a comment request.

by Apple is priced cheaper Android phones by Samsung Electronics and other manufacturers under high competitive pressure. Samsung had also unveiled a new smartphone in September, the Galaxy Note 3 to the accompanying SmartWatch Galaxy Gear. HTC also makes its devices with new features such as a fingerprint scanner technically attractive.

investors had called for Apple to meet the competition with a cheaper smartphone that new buyers in China and other emerging economies could appeal. The iPhone was pre-5C as a beacon of hope. Analysts had expected a sale price of about $ 350. Many investors were disappointed that the actual price was much higher.

The product launch – the first time that Apple introduced two phones at the same time, the demand seemed to be particularly high for the premium smartphone at the front of the Apple stores waiting masses. According to analysts, the iPhone 5S was purchased disproportionately. On its website, Apple announced that customers need to take several weeks for new orders waiting in purchasing. According to the company 9 million iPhones were sold in the first weekend. However, Apple did not say how many of them accounted for the variant.

Apple has informed its suppliers, according to the insider earlier this month about the cuts in orders for the iPhone 5C. Hon Hai has therefore already stopped the planned recruitment of additional staff, a manager said. In September of suppliers from Taiwan announced that it will increase its workforce because of the orders for the iPhone 5C. At the same time Apple but the higher orders for the iPhone 5S have increased in the fourth quarter.

suppliers in Asia is seen as a reduction in the proof of the weak demand for the colorful iPhone. Although the contracts have sales do not correspond directly – but there is more evidence of a demand flat ones,

In recent weeks, several mobile operators already have the price of the iPhone 5C lowered. For China Telecom, the device with 16 gigabytes of memory costs only 3,788 yuan (460 euros), equivalent to a discount of 700 yuan. The U.S. retailer Wal-Mart now sells the model with a two-year contract for $ 79, $ 20 less than before. According to the website of Apple in the U.S., Germany and China, the iPhone 5C is sent there within 24 hours. The 5S has a waiting time of 2-3 weeks.

In China, an iPhone without a contract costs 5S 5,288 yuan, about 641 euros, the iPhone 5C against 4,488 yuan (544 euros). According to market researchers at Gartner are to be had for the equivalent of less than 300 EUR comparable smartphones from other manufacturers in China.

Especially in China, the high prices made it difficult to Apple, “the largest mobile market in the world for customers to keep up,” said Marvin Lo, an analyst at Mizuho Securities. “Customers in more developed markets such as the USA and Hong Kong also prefer the iPhone 5S, because the price difference between the two new iPhones is low.”

reduced orders from Apple could be reflected in the balance sheets of the suppliers and contract manufacturers. Hon Hai and Pegatron are highly dependent on the U.S. group. Pegatron is expected to announce a corresponding decline in revenues, says a person familiar with the matter, as it is now too late to find new customers for that period

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