"Falling Short of Demand Expectations... Apple Abandons Plans to Increase iPhone 14 Production"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Bloomberg News reported on the 27th (local time), citing multiple sources, that Apple has decided to cancel its plan to increase production of the iPhone 14 series released this year due to demand falling short of expectations.

According to the report, Apple recently informed its suppliers that it would cancel the plan to increase iPhone 14 production in the second half of this year.

Initially, Apple had indicated that it could increase orders by about 7% in anticipation of explosive demand ahead of the iPhone 14 launch. Until this summer, Apple planned to produce about 90 million new products this year, similar to last year, with the possibility of producing up to an additional 6 million units.

However, after confirming that demand did not significantly increase after the launch, sources said Apple ultimately decided to maintain production at last year’s level. Some sources reported that demand for the iPhone 14 Pro models is stronger compared to the standard models, and one of Apple’s suppliers is switching some production lines from the standard models to the Pro models.

This news of Apple’s plan withdrawal came amid reports that smartphone manufacturers are being hit by the economic slowdown in China, the world’s largest smartphone market. According to global investment bank Jefferies, sales of the iPhone 14 series in China during the first three days after launch decreased by 11% compared to the iPhone 13 series last year.

According to market research firm IDC, global smartphone sales this year are expected to decline by 6.5% to 1.27 billion units compared to the previous year. Navila Popal, Research Director at IDC, said, "Supply constraints that dragged the market down last year have eased, but demand constraints continue," adding, "There is already a large inventory, and there are no signs that the demand slump will recover anytime soon."