This year has been quite challenging for smartphone manufacturers due to chip shortages and supply chain issues. Looking at the markets, Apple Inc. is planning to keep iPhone 14 production roughly flat in 2022.
Apple is reportedly asking its suppliers to assemble roughly 220 million iPhone 14’s, about the same as last year. According to reports, market forecasts have gone closer to 240 million units, driven by an expected big update to the iPhone in the fall.
Will iPhone 14 production see a halt?
Firstly, the mobile industry has gotten off to a difficult start to the year. The production estimates are also down across the board. Inflation is at its highest level in decades, war in Ukraine and supply-chain disruptions all threaten to affect sales in 2022.
Overall smartphone sales are expected to decline by as much as 2% in 2022, according to Strategy Analytics, and TrendForce’s full-year production prediction has been reduced twice in recent weeks. Analysts at IDC and Bloomberg Intelligence both predicted 240 million iPhones for this year earlier in the year.
Apple made no comments on the iPhone 14 forecast and how it would change in the upcoming months. Apple does not disclose its production targets and stopped showing how many iPhones it sells to the general public in 2019.
The company previously warned about the impact on sales as Covid-19 lockdowns are roiling production lines in China. The whole tech industry is bracing for a slowdown as rising fuel and materials prices push up the cost of everyday essentials.
According to the sources, Apple is counting on strong demand for its products. The confidence is due to its significantly large user base and the strength of its software and services ecosystem. Furthermore, Apple intends to entice customers with the iPhone 14, which would surpass last year’s model in terms of innovation.
New screen sizes and features like satellite-based text messaging are expected in the future iPhone 14 devices coming this fall. Though the Chinese lockdowns will take a major toll on Apple this quarter, the company expects to handle the turbulence.
Is Apple currently on track?
Foxconn Technology Group, Apple’s main iPhone manufacturer, has been able to keep most facilities running. That includes its largest group of factories in the central Chinese city of Zhengzhou.
The second quarter usually sees a drop in smartphone demand. However, reports are suggesting that the implications of lockdown won’t be severe. And suppliers will try to make up for any shortfall in production later in the year. Looks like the iPhone 14 will be arriving on time.
“This year will be a tale of two halves,” Strategy Analytics senior director Linda Sui said last month. “Geopolitical issues, component shortages, price inflation, exchange rate volatility, and Covid disruption will continue to weigh on the smartphone market during the first half of 2022 before the situation eases in the second half,” said a report on Bloomberg.
Comment down your thoughts on the scenario.