Apple cancels iPhone XR production boost due to low demand

Delia Walker
November 8, 2018

Apple began shipping the iPhone XR on Oct 26 after two weeks of pre orders. Apple's array of color options were also expected to give consumers more of the choice they wanted. However, it is now using only around 45 lines and does not require any additional production capacity.

Starting at $749, Apple's new iPhone XR has been touted as a wallet-friendly option for those who want a new Apple smartphone.

Investors continued doing damage to Apple's stock price on Monday, following the company's controversial move to end the disclosure of unit sales data for its iPhone, iPad and Mac businesses.

Apple reportedly told three different suppliers to reduce or completely eliminate production lines for the device.

Interestingly, while on one hand the company is facing sluggish demand for its newly launched iPhone XR, the company is requesting its manufacturers for more units of its year-old iPhones- iPhone 8 and iPhone 8 Plus. iPhone 8 and iPhone 8 Plus suppliers are getting a combined order of 5 million more units raising the figure to a total of 25 million units.

Apple shares fell almost 4 percent on Monday after the report by the Nikkei financial daily, which fueled concerns that the iPhone XR - the cheapest of three iPhones unveiled in September - was facing weak demand just days after it went on sale.

"For the Foxconn side, it first prepared almost 60 assembly lines for Apple's XR model, but recently uses only around 45 production lines as its top customer said it does not need to manufacture that many by now", the Nikkei quoted one source as saying.

Maybe iPhone sales decline over time, or maybe Cupertino has something to hide.

Meanwhile the iPhone 8 has profited significantly from the weakness of the iPhone XR.

Apple closed just above $200 on Monday amid a wider tech sell-off that has seen other FAANG stocks - Facebook, Apple, Amazon, Netflix, and Google - fall in recent weeks.

However, it looks like the iPhone XR isn't selling as well as Apple might have hoped, according to a new report from Nikkei Asian Review.

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