Apple supposedly cutting iPhone 5c production in half due to low demand

Apple supposedly cutting iPhone 5c production in half due to low demand

Apple may be cutting production of the iPhone 5c in half due to demand being lower than expected. Sources say that production is currently at 300,000 units a day and will be cut down to 150,000 units a day. According to CTechnology, poor demand is due to the higher than expected price and the iPhone 5s outselling it.

While it is very possible that Apple wrongly estimated demand for the iPhone 5c, we also have to keep in mind that it's also a much easier phone to produce than the iPhone 5s. The iPhone 5s has a more complicated assembly paired with newer and harder to produce components that can easily bottleneck the supply chain, the M7 chip in particular is most likely causing issue.

This creates a problem wherein people assume Apple grossly underestimated demand for the iPhone 5s and overestimated demand for the iPhone 5c.

The iPhone 5c was never made to compete with the iPhone 5s. I also don't think Apple was naive enough to expect the iPhone 5c to sell even a small fraction of the amount of units the iPhone 5s sold at launch. We've already talked about why we think the iPhone 5c will sell well and I think most of us here at iMore still stand behind that.

While soft initial demand may be the case for the iPhone 5c, it's a phone that didn't face the same constraints as the iPhone 5s so comparing the two probably doesn't provide the most accurate overall picture. Apple will sell a good amount of iPhone 5c units, but those units will be sold over a spread out period of time to users who are out of contract and upgrading and don't want to pay $200 or more for a smartphone. That is the audience the iPhone 5c is aimed at. Not those of us who want the latest and greatest in bleeding edge technology. For us, there was the iPhone 5s.

It'll be interesting to see how the iPhone 5c does over the holidays and in the coming months as demand for the iPhone 5s catches up and production of both models can level out.

Source: CTechnology via cnet

iPhone 5c

iPhone 5c
Apple's first popular iPhone with a 4-inch in-cell display, LTE 4G, and BT 4.0 LE. Fun features include:

Complete review >

Released
September, 2013

Alternatives
iPhone 5s, iPhone 4s

Replacements
iPhone 6 (rumored)
Fall, 2014

Resources
Buyers guide
Help forum

iPhone 5s

iPhone 5s
Apple's current flagship iPhone with a 4-inch in-cell display, LTE 4G, and BT 4.0 LE. New features include:

Complete review >

Released
September, 2013

Alternatives
iPhone 5c, iPhone 4s

Replacements
iPhone 6 (rumored)
Fall, 2014

Resources
Buyers guide
Help forum

Allyson Kazmucha

Editor for iMore, Potter pundit, and the ninja in your iOS

More Posts

 

17
loading...
0
loading...
80
loading...
0
loading...

← Previously

How to quit or kill multiple apps at once on your iPhone or iPad

Next up →

Scanner Pro for iOS updated to version 5.1, brings better image processing

There are 27 comments. Add yours.

sting7k says:

Still haven't seen a 5c in the wild. I've seen each of the 3 colors of the 5s though; lots of them.

KCMike says:

I've yet to see one either. Best is now offering it for 'free' on a 2 year contract when you trade in a working iPhone. Might not be a bad idea since I have the iPhone 4 (I don't have the $99 at this time to put down on the 5s).

shathis says:

Seen a few here in Japan. Mostly people starting back with Docomo. Docomo has been bleeding customers for so long they made them cheap with lots of back-end tricks to fool customers and bite them a year later.

Derrick4Real says:

it's a well made solid phone. I held one two days ago. But i don't think pastel colors help or the fact that the 5c and 5s don't have a ton of difference between them to the non phone enthusiast.

Trappiste says:

When it will be available, the 5C will cost EUR 699 here in Europe, and 5S EUR 799 (16GB.) With these prices, why on Earth would anyone buy the 5C is totally beyond me. With operator subsidises the prices will coem down EUR 100...150 for both products, to 600€ and 700€ respectively. 5C is too darned expensive for what it is -- a plastic iPhone 5. That value proposition is just silly. 5C should cost EUR 500 at max to sell agaisnt 5S.

Carioca32 says:

Exactly, same problem in my coutry. The price difference just does not justify the 5c purchase. The guys at iMore can try to read and justify this any way they want, but in the end it will come down to Apple making a mistake and pricing the 5c too high to generate demand.

shathis says:

I have to be fair, iMore is getting a little it too "justify-happy" when it comes to everything Apple does. I'm not sure what's happened, because iMore used to be a bit more even-handed, not apologist. This is a fan site, admittedly, and I love my iPhone, but I'm not going to just say "great job Apple" when Tim Cook makes a mistake.

AdamChew says:

I believe you have forgotten what Tim Cook said that the 4 and 4s were selling very well and in fact better than the 5.

So it is logical for them to priced the 5c lower than the 5s to cater to a group of people who don't want the 5s.

Btw many may want to forego the 5s so they can pay less.

Can you explained the popularity of the 4 and 4s when they can pay $100 to get the latest and greatest but they didn't.

Etios says:

Apple should have sold iphone 5 for lower prices as usual instead of trying this plastic-fantastic stunt to further boost profit margins.

Solamar says:

Besides the points in the article, It's just as likely they are just done ramping up inventory for the release. Also keep in mind, that sales at ATT/Sprint have 5c at 2nd place as best selling phone. 3rd best at Verizon and T-Mobile.. Kind of hard to see it doing poorly.. I mean really. What did the analysts expect?

Dev from tipb says:

Errr...this has nothing to do with analysts - if the report is accurate, Apple overestimated initial demand. That doesn't necessarily mean it is selling *poorly* in absolute numbers, just not as well as Apple planned, so they are ratcheting down production.

Sent from the iMore App

ankush77 says:

iphone 5c for me is not the apple philosophy of making phone,they have made it to peruse their other way to enter cost competitive market,lets see what future has to hold for them.

Metro1088 says:

I agree that the 5c is meant to be sold to people on contract. They difference of 18% between it and the 5s unlocked price just doesn't justify the purchase. But 50% off and in the case of major supermarkets discounting it up to $50 less... It becomes a good investment. But people's contracts don't all end on the same date so I agree that this phone would sell steadily all year.

joshrocker says:

I'm starting to believe that Apple's 5S supply issues are more about their overly ambitious plan to release in so many countries and carriers in such a short time instead of any manufacturing bottle necks.

Completely agree however that the 5c will sell a lot over over the long term. There are a lot of people who want the cheapest iPhone possible. I think it would have been better suited for either free or even $50 but it will still sell well to the non techies.

Carioca32 says:

Whoever is really constrained by price will not buy an iPhone. The cheapest possible will be a 4 or 4S on ebay. A 32Gb 5c costs exactly the same as the 16gb 5s, which one would you buy?

khobia2 says:

Good article. Not surprised this came from CNET albeit via another source. They are all about crying wolf over there. Liked what Solomar in the comments said. Cnet just has to write something about Apple everyday. No matter how half-ass it might be.

YorkieRay says:

It took me no time at all when the 5c was launched to find the Samsung Galaxy S4 and the HTC One substantially cheaper here in the UK than the 5c. Especially when you take into account that these and other phones that I found, have much bigger screens.
Also, it was Steve Jobs who labelled the iPod Touch as, "the iPhone without a contract". Sure the iPhone has a higher spec and can make calls, but they both run the exact same os and both have the exact same screen, at first glance they even look the same. So, could someone please justify why an iPhone 5c should cost more than double the price of an equivalent iPod Touch. Are those extra specs on the 5c really worth more than what you could pay for a whole iPod Touch?

joshrocker says:

I think the answer is you're not meant to buy an iPhone off contract. They really make these phones attractive to on contract buyers. Most of us couldn't afford a full priced iPhone and most of us don't pay the unsubsidized price.

Team George says:

I wonder how it is selling compared to the 4s was this time last year, given that model became apple's "cheap" option / second best iphone from September 2012, just like the 5c is in 2013. Surely that's the best comparison in terms of like for like sales?

Sent from the iMore App

Carioca32 says:

I disagree.

Upon launching the 5, Apple marketed the 4s as a "last years model" nothing more. The 5c is being marketed as a new phone, with a new design, new materials, a new concept of a colorful "pop" product for "fun people". Educated consumers will understand that it is basically the 5 in cheap plastic, but I don't think that's the case with most consumers.

At this price point I say it will flop worldwide, and that Apple pundits at iMore seriously overestimated Apple's ability to market it. Unless its the ONLY iPhone Apple sells in some markets, or if it gets a serious price reduction, its just too a weak a competition to the 5s.

Digitalrex says:

You all do realise that demand always slips after Q4 and this could have been planned from the beginning and not necessarily due to weak demand. Also 300k phones a day..... That's a lot of phones....

wamadden4 says:

Saw this coming... no real reason to get a 5C other than the fact that you are cheap and cant spring for a 5S LOL

DravenX says:

It's still not really that cheap either. There is no point in the 5C. I only know one person who has it and she is some young freshman in college.

GlennRuss says:

Did they make the mistake of just making a color version of the 5, with a little zip under the hood, but still a 5. The 5S is so much more. Another thing to think about, with new products coming out soon, If I had a 5, I may wait to upgrade, saving money for a new iPad, or iPad mini Retina. There are so many color cases out there, you can make your 5 in any color. No matter how you feel about the fingerprint scanner, if the 5C had it. This article may be a different story.

Jonathan Moosey says:

This has to be the Edsel of iPhones here. What Apple really needs to do is dump the 16 GB models and sell the 32 GB at the $199 price point. They could've done it had they not waste their resources on the fingerprint scanner. Another mistake is taking the existing iPhone 5, slap a plastic back on it replacing the aluminum back and then saying its a new phone. Also get Verizon customers talking and surfing at the same time finally. 3 years that Verizon has been selling the iPhone and Apple still can't figure out how to make that happen on Verizon's network.

Sent from the iMore App

joshrocker says:

I agree, the 16 gig model needs to be dropped and 32 gig become the baseline model. Where I don't agree is the fingerprint scanner. I love it and now that i've used it, I don't want to go back to a phone without it.