Foxconn chairman says company is falling short of demand for Apple's iPhone 5 - Page 2

Quote:

Originally Posted by Constable Odo 

Thank you, Tim Cook, for not being able to build a decent supply chain of Apple products. The news media is having a field day and Wall Street believes every word of it. Samsung can supply tens of millions of its smartphones to consumers without a sweat, but Apple struggles. With loss of innovation and a poor supply chain, there's only one direction for Apple to go and that's down.

While some of the problem seems to be QA issues, you do not build a supply chain to handle peak demand - you build it for average demand.   Otherwise when demand declines or near the end of a model life, you're stuck with tons of expensive unused capacity, even if it's a third-party contractor.     Just as it always has, this will all settle down by another eight weeks.     From a marketing perspective, it works very well  - inability to get a phone creates demand for it.

While it is frustrating to have to wait (I'm waiting to buy as well), the demand is unprecedented.    I've posted the following many times before, so I won't post all the details, but it's taken most consumer products a  year or more to reach sales of one million units.   Apple now does this regularly in a few days of releasing a new product.

The one thing I will agree with you on is that Apple's stock has been heading down because of Wall Street reaction to Apple's supply problems.  But I think it will come back up with the next earnings report.

But Apple itself heading down?    That's absurdity.   By many measures, it's the most successful consumer products company in the world.    And even its current cruddy stock price is 55% above its 52 week low.   Name one other company that's accomplished that.   Apple stores are consistently PACKED with people.  And while many are only tire kicking or checking their email, it shows the level of interest in Apple products.    In spite of the mixed reviews, I couldn't get near the iPad Mini table in the Grand Central Terminal Apple store earlier today and all the comments I heard from people who checked it out were very positive.   Meanwhile, the Microsoft store in Times Square was empty when I passed by yesterday.

Quote:

Originally Posted by Carthusia 

A legitimate question is of Apple's willingness to, plans for, or ability to bring more iPhone factories on line. I understand the argument that there are only so many Chinese workers, but....there are hundreds of millions of Chinese workers. Surely tens of thousands, including managers, etc. could be recruited to bring more factories on line.

 

I know it's not an overnight process, but couldn't Apple have anticipated this demand several years ago? And couldn't the new factories kinda copy the template of the existing factories? 

 

In essence, doesn't the failure to do so indicate some sort of supply-chain management problem? Just sayin'....

Apple isn't Foxconn's only client so the other lines are being used by the other 75-80 companies and their products. So opening more lines for Apple means either cutting lines for the other boys (which could be against contract terms) or literally building more buildings to have more lines and more dorms for workers. That's a good year project. 

As for the demand, it's hard to ever properly calculate demand. Apple year after year guesses what demand will be but if they under guess this kind of problem happens. Even if they double last years demand for the 4s, the actual demand could be 3-4 times last year. Same with the ipad 4th gen and ipad mini. Not being able to guarantee correct demand for particular units is part of why they don't stock pile for months before a launch (security is another reason). They best guess and then adjust according to what sells the fastest. 

As someone else pointed out, what really matters is the numbers. Is this an HP level mistake (only making 5k units with a delay of weeks before you can make more) or a case of "we can make 10 million units a week but demand is 12 million". If it is the latter that is a great place to be particularly if folks are willing to ride it out. And in most cases they are. They will whine about it but they will wait

Quote:

Originally Posted by zoetmb 

 

While some of the problem seems to be QA issues, you do not build a supply chain to handle peak demand - you build it for average demand.   Otherwise when demand declines or near the end of a model life, you're stuck with tons of expensive unused capacity, even if it's a third-party contractor.     Just as it always has, this will all settle down by another eight weeks.     From a marketing perspective, it works very well  - inability to get a phone creates demand for it.

 

If there truly is a chronic QA issue with the phone's manufacture, then eight weeks is optimistic. I can't recall word from manufacturing in the past that something was ever difficult to assemble. They've often talked about innovative manufacturing process, but flat out difficulty in yield other than to meet demand is something else. 

"Oh woe is us! We have too much work!" said the company in the middle of a global economic downturn.

Originally Posted by Quiet_Desperation 
"Oh woe is us! We have too much work!" said the company in the middle of a global economic downturn.

No downturn in the demand for Apple products!

Quote:

Originally Posted by Curtis Hannah 

Apple needs a second supply chain, hopefully American.

Any more jokes?

Quote:

Originally Posted by Ireland 

 

Any more jokes?

Two iPhones walk into a bar...

Originally Posted by island hermit 
Two iPhones walk into a bar...

The barman says, "How'd you find the place?"

Quote:

Originally Posted by dasanman69 


He's probably gonna go into a rant about how much you pay for service from your carrier and how it's overpriced which isn't exclusive to the iPhone. It's quite alright for Apple to have healthy profit margins but god forbid anyone else does. One cannot buy a Ferrari to then complain about the price of premium gasoline.

It seems like some people like to include the cost of service into the cost of the phone and call it the total cost of owning an iphone. I find this absolutely ridiculous. We don't add in the cost of gas and claim that our car costs over 200k. Or even add in cost of electricity, water, garbage, etc. and call our house a million dollar house. While it's true that some wireless lines are cheaper without a contract, I've yet to find a deal that is even worth my time to switch to. I had a line out of contract for over 8 months before using it to upgrade to the iphone 5.

The cost of the iphone 5 is $199 plus tax. No matter how others will try to spin it, they have to pay a wireless service bill with or without an iphone. They can't include that in the cost of the iphone because the cost is already there. It won't stop them from imposing their views that we're actually paying $1,000 for an iphone though. As far as I'm concerned, I paid $199.

If you are purchasing your iphone on a two year deal with any of the devils, you ARE already paying that much for your iphone.

Quote:

Originally Posted by Rogifan 


You want to pay $1000 for an iPhone? I don't.

Originally Posted by fireside 
If you are purchasing your iphone on a two year deal with any of the devils, you ARE already paying that much for your iphone.

Nope. Not part of the argument.

The iPhone is too complicated to be mass produced at high quality. Foxconn should not be blamed for this. Apple should learn from Samsung by making simpler mass market phones, in order to capture a larger market.

Originally Posted by ClemyNX 
Calling someone who's been here for years a troll, that doesn't make sense.

That's not a condition of sensibility in this regard, but believe what you want to believe.

Quote:

Originally Posted by Noliving 

If they were made in the US you wouldn't pay $1000, it would most likely only add around $100 to the cost.  You have to remember that those foxconn workers work on a lot more than one iphone per hour so the cost of the hourly wage does not add to the cost of the phone as you think.  For example if a worker gets paid $100 an hour but creates 10 products in one hour than the cost of labor was $10 per unit

You are failing to account for the fact that the parts for the iPhone aren't made here. This is far more than an assembly issue. You would need to build all the infrastructure, move parts suppliers here etc. to create an efficient system to hold down costs. But most importantly, as stated by many before, you could not possibly ramp production in the US as you can in Asia. Not enough engineers or workers available in any one location in the US to meet demand. The main iPhone factory in Shenzhen employees approximately 400,000 people, greater than the population of the overwhelming majority of US cities. There are only 9 cities in the US with populations greater than 1 Million. And only 44 with a population of over 400,000. So those workers would come from where again? If you are going to try to make logical arguments as to why or why not manufacture in the US you need to do more homework.

Quote:

Originally Posted by peter236 

The iPhone is too complicated to be mass produced at high quality. Foxconn should not be blamed for this. Apple should learn from Samsung by making simpler mass market phones, in order to capture a larger market.

LOL - and less profit? It is a recipe for disaster. The iPhone is the best engineered and built phone on the market. One of the key reasons people buy it. Why would they want to race to the bottom? I like their market share - it is 90% of mobile profits!!!!

Quote:

Originally Posted by ClemyNX 


A troll is someone who comes on a forum to disrupt the discussion. Calling someone who's been here for years a troll, that doesn't make sense. Calling anyone with whom you disagree a troll, that's trolling. **** off troll.

Thank you, Tim Cook, for not being able to build a decent supply chain of Apple products. The news media is having a field day and Wall Street believes every word of it. Samsung can supply tens of millions of its smartphones to consumers without a sweat, but Apple struggles. With loss of innovation and a poor supply chain, there's only one direction for Apple to go and that's down.

I have highlighted the words that just complete friction and no factual evidence to support.One product and he is bad at supply chain, when he is recognised by the industry for his supply chain management and well documented concerning Tim's  sweeping changes in Apple to improve profitability by making supply chain more efficient. How does the issues of manufacturing the product relates to loss of innovation????????? 

This is the full meaning of a Troll:

In Internet slang, a troll is someone who posts inflammatory,^[3] extraneous, or off-topic messages in an online community, such as a forum, chat room, or blog, with the primary intent of provoking readers into an emotional response^[4] or of otherwise disrupting normal on-topic discussion.^[5]  http://en.wikipedia.org/wiki/Troll_(Internet)

Highlighted the word, why I called him a troll, so my comment stands!

Lastly, thanks for the colourful language at the end, thats where our discussion stops and you on ignore.bye

Edit: here is some links you should read 

http://appleinsider.com/articles/12/06/18/under_tim_cook_apple_cracking_down_on_supply_chain_management

http://www.huffingtonpost.com/2012/09/22/apple-supply-chain-tim-cook_n_1905674.html

http://www.phonearena.com/news/Tim-Cook-bringing-more-efficient-supply-chain-and-aiming-for-thinnest-iPhone_id29405

http://www.macworld.co.uk/apple-business/news/?newsid=3361523

Quote:

Originally Posted by dasanman69 


Unfortunately what we know as fact is not well known by the general public. So perception is that Apple has a problem with supply and the current stock price reflects that.

I agree, but this person has stated by ClemyNX  has been longer in forum, then me, so he should know better. I provided an appleinsider  link above (apologies after you posted this reply) that discusses Tim's strengths in supply chain management.

The fact is the iphone 5 has been praised by every reviewer on the internet, it defeated the samsung s3 on cnet prize fight and won several awards from some of the most prestigious reviewers included Walt Mossberg. Look the iphone just works, you turn it on and it works, you turn on the samsung s3 and it doesnt work.

Foxconn needs to hire more workers and start pumping more iphones through the pipeline. It's only a matter of time and people shouldnt be worried about ip5s arriving for the holiday season. Just be patient. 

Quote:

Originally Posted by dasanman69 


Really? Millions of SGS lll sold and not a single one of them works?

What I mean is that the iphone 5 just works in terms of functionality and reliability while the gs3 which has sold millions has an os that is unreliable. Thats the problem with an open system, you allow yourself to be attacked with malware, viruses, and other issues. It just isn't as stable as iOS. Its good to have reassurance that if you turn on the ip5, you wont experience the kind of issues that plague millions of Android users on a daily basis. 

Quote:

Originally Posted by quest01 

The fact is the iphone 5 has been praised by every reviewer on the internet, it defeated the samsung s3 on cnet prize fight and won several awards from some of the most prestigious reviewers included Walt Mossberg. Look the iphone just works, you turn it on and it works, you turn on the samsung s3 and it doesnt work.

 

Foxconn needs to hire more workers and start pumping more iphones through the pipeline. It's only a matter of time and people shouldnt be worried about ip5s arriving for the holiday season. Just be patient. 

I would not have quoted the Cnet prizefight, since it was very very close the  result and reviewers heaped praise on Samsung SIII. 

see prizefight link http://cnettv.cnet.com/apple-iphone-5-vs-samsung-galaxy-s3/9742-1_53-50131947.html

Final score iPhone 5   4.73 and Samsung SIII 4.66 and after normal 5 rounds it was a tie and there went back on scores to 0.01 intervals to decide the winner.

Your comments about SIII  imply that it is vastly inferior to iPhone 5, which is not true.

My personal choice is iPhone 5 because of built quality and developed ECOSYSTEM, but if Apple did not manufacture a phone, I would be hard pressed not to buy S III.

Quote:

Originally Posted by souliisoul 

I would not have quoted the Cnet prizefight, since it was very very close the  result and reviewers heaped praise on Samsung SIII. 

 

see prizefight link http://cnettv.cnet.com/apple-iphone-5-vs-samsung-galaxy-s3/9742-1_53-50131947.html

 

Final score iPhone 5   4.73 and Samsung SIII 4.66 and after normal 5 rounds it was a tie and there went back on scores to 0.01 intervals to decide the winner.

Your comments about SIII  imply that it is vastly inferior to iPhone 5, which is not true.

 

My personal choice is iPhone 5 because of built quality and developed ECOSYSTEM, but if Apple did not manufacture a phone, I would be hard pressed not to buy S III.

I wouldn't say the ip5 is vasty superior to the S3, I'm just staying there are aspects of the ip5 that could potentially save your life.

For instance just to be hypothetical here which are real world scenarios too but if your trapped in a corner and an axe wielding maniac is running after you and you needed a phone to get you of a life threatening situation, 9/10 your going to choose the iPhone 5 to dial 911 or access the internet without worry of crashing.

Or another scenario if your driving and your brakes stop working and your about to go over a cliff, and need a phone to get you out of a critical situation, most people will probably choose the iPhone 5 for security and reliability over the S3. 

People are going to want a device that "just works" over a device such as the s3 which does basic things right but in moments where we are faced with life threatening situations, people just want reassurance that they chose a device that saved their life.

Quote:

Originally Posted by quest01 

 

I wouldn't say the ip5 is vasty superior to the S3, I'm just staying there are aspects of the ip5 that could potentially save your life.

 

For instance just to be hypothetical here which are real world scenarios too but if your trapped in a corner and an axe wielding maniac is running after you and you needed a phone to get you of a life threatening situation, 9/10 your going to choose the iPhone 5 to dial 911 or access the internet without worry of crashing.

 

Or another scenario if your driving and your brakes stop working and your about to go over a cliff, and need a phone to get you out of a critical situation, most people will probably choose the iPhone 5 for security and reliability over the S3. 

 

People are going to want a device that "just works" over a device such as the s3 which does basic things right but in moments where we are faced with life threatening situations, people just want reassurance that they chose a device that saved their life.

I am not sure if you are serious or just being sarcastic...I hope you are being sarcastic, since in all those situation, what type of phone you have will be last thought on your mind!

Quote:

Originally Posted by souliisoul 

I agree, but this person has stated by ClemyNX  has been longer in forum, then me, so he should know better. I provided an appleinsider  link above (apologies after you posted this reply) that discusses Tim's strengths in supply chain management.

I wasn't saying that he knew better. I was just saying that you responded to his post by calling him a troll. That's a bit easy. Your second answer is much more interesting.

Sorry for insulting you.

Quote:

Originally Posted by quest01 

 

I wouldn't say the ip5 is vasty superior to the S3, I'm just staying there are aspects of the ip5 that could potentially save your life.

 

For instance just to be hypothetical here which are real world scenarios too but if your trapped in a corner and an axe wielding maniac is running after you and you needed a phone to get you of a life threatening situation, 9/10 your going to choose the iPhone 5 to dial 911 or access the internet without worry of crashing.

 

Or another scenario if your driving and your brakes stop working and your about to go over a cliff, and need a phone to get you out of a critical situation, most people will probably choose the iPhone 5 for security and reliability over the S3. 

 

People are going to want a device that "just works" over a device such as the s3 which does basic things right but in moments where we are faced with life threatening situations, people just want reassurance that they chose a device that saved their life.

Lol don't be silly. It's not like people who own a GS3 can't make a phone call. My Android didn't crash more often than my iPhone 5, and the iPhone 5 crashes sometimes. But it had more lag. That and lack of really nice apps is still the main difference between Android and iOS for me.

Quote:

Originally Posted by souliisoul 

I am not sure if you are serious or just being sarcastic...I hope you are being sarcastic, since in all those situation, what type of phone you have will be last thought on your mind!

In this case I would want a 12-gauge shotgun.

Quote:

Originally Posted by ClemyNX 

 

I wasn't saying that he knew better. I was just saying that you responded to his post by calling him a troll. That's a bit easy. Your second answer is much more interesting.

Sorry for insulting you.

apology accepted.