Foxconn Struggles To Meet iPhone 5 Demand


Foxconn says that its flagship Hon Hai unit is struggling to assemble enough iPhone 5 units

Foxconn, one of the key members of Apple’s supply chain, has admitted that it is finding it difficult to cope with demand for the iPhone 5.

Its flagship Hon Hai factory is currently assembling the smartphone, but Foxconn Chairman Terry Gou told Reuters that it is “falling short of meeting the huge demand.”

The iPhone 5 was released in September and Apple claimed to have sold more than five million devices in just three days.

Gou did not comment on reports that the company’s other unit, Foxconn International Holdings (FIH), may take over some production. FIH is the world’s biggest contract maker of mobile phones, assembling products for the likes of Nokia and Huawei.

Foxconn iPhone problems

Rumours that FIH would be delegated some production were fuelled by Citgroup, which said on Monday that it expected the firm to start assembling iPhones later this year. It upgraded FIH stock to ‘buy’ as shares surged by as much as 35 percent.

This uncertainty in the iPhone production line has had a knock on effect on Apple, whose shares slumped to a five month low on Wednesday, marking a 20 percent decline in market value since shares hit a record high in September.

Foxconn is used to facing scrutiny of a different kind. Questions about working conditions at the company’s Chinese plants have persisted following a number of employee suicides and accidents at its factories.

Most recently, it had to suspend production at a factory in northern China after a riot involving around 2,000 workers erupted.

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