Apple Inc is going to scale back its iPhone production for the fourth quarter to keep pace with expected recession period. According to FBR Capital Market analyst Craig Berger Apple has suggested to reduce the production of 3G iPhone by 40% in the fourth quarter as compared to previous quarter. As during the previous third quarter Apple has produced about 6.9 million 3G iPhones but the number of orders it has actually taken is not clear.
One reason behind this drastic downturn in iPhone production is to put more effort to expand the circle of its activity beyond the current market boundaries to other countries before the actual launch of iPhone 3G. To cater the expected demand of 3G iPhone, Apple would prefer to go for overproduction instead of getting trapped into shortage complications.
At the event of company’s last earnings conference call, Tim Cook Apple COO claimed that till the end of September World’s largest iPhone producer with have direct access to 51 countries marketplace to sell its iPhones there.
Another factor behind limited demand of iPhone could be the ongoing recession period which has badly stricken the consumer’s buying strength. So it seems hard to get them back to expected level of demand particularly in ongoing financial crisis.
Due to current global financial market trends Apple has decided to work on its existing iPhone devices rather than going for experimenting for entirely new productions. As current year is not expected to gain more consumer activity as it was seen in previous years.
Fri, Nov 13, 2009
Codie's World