The iPhone may experience a very complicated six months in 2023
As winter sets in in the Northern Hemisphere and in China, the pandemic is intensifying again as Chinese authorities ease control measures. iPhone production could suffer a lot, and China even more so.
The pandemic is far from over for Apple! The situation could turn into a disaster after a complicated end to the year that saw Chinese authorities ease storage policies in certain regions, including Zhengzhou, to meet iPhone production needs.
According to production line experts, factories working for the American giant will be threatened by a new virus outbreak in China. The threat could affect iPhone production enough to cause concern within a few months. This makes perfect sense, remember that 90% of iPhones are manufactured in China. We better understand why Apple is on a forced march to move its smartphone manufacturing out of the Middle Kingdom, particularly India.
Will delays increase?
Currently, at the French Apple Store, the iPhone 14 Pro Max ordered today should only be delivered between January 5 and 12 – yes, too late for Christmas. according to Financial Times, reports the information and the Swiss bank USB, which conducts market research, the situation is even more tense in the United States. High-end iPhone 14s are already subject to a delay of around 23 days between order and delivery.
A disastrous situation for Apple, whose holiday season is always synonymous with record sales and the best financial quarter. The Cupertino giant is working hard with Foxconn to move iPhone production to other factories in other parts of China less affected by the virus. Apple has also ensured reduced delivery times for components manufactured by its suppliers.
However, despite his corrections, experts note many elements that could threaten the production of iPhones, as well as other Chinese-made technological products.
In addition to the usual Chinese New Year holidays, the beginning of the year can be marked by high levels of absenteeism and “not just in factories”explains the expert supply chain daily finance, “as well as in warehousing, distribution, logistics and transport”.
Two to six major months
Last November, Apple warned of major holiday disruptions, with sales down about 8% due to product shortages. Car cash Because of these production problems, the iPhone would actually be discontinued. In the end, between 5 and 15 million iPhones will be “missed”.
Initially, market analysts believed that these sales would only be delayed, but now some believe that this will not happen. This would be especially the case in China, which is Apple’s third most important region after the US and Europe and accounts for a fifth of its revenue. The Chinese could really reconsider their priorities in the face of the pandemic.
“The next two to six months will be extremely important for Apple’s supply chain due to China’s immaturity in dealing with Covid”he explained Financial Times Alan Day, an expert on supply chains working specifically with the UN on standards for companies to respond to the coronavirus outbreak. “The rest of the world has developed standards”he continued, “However, Chinese companies have not been encouraged to adopt these standards”. Paying the price can be heavy. But it’s not Apple who will be most sorry.
In fact, this management “immature” can have a terrible human cost. A figure put forward by some simulations suggests that one million Chinese are at risk of dying from Covid during the winter months. The pandemic continues to wreak havoc in China, and winter is here.