Analysts are predicting that Apple could down the orders for all three iPhone models even further for the March quarter
Jun Zhang, an analyst at Rosenblatt has issued an investor note in which he outlines that Apple is likely to further reduce the production of its 2018 iPhone lineup, with the iPhone XR slated to take the biggest hit. Zhang attributes the second reduction in the iPhone production to the arrest of Huawei CFO.
Canadian authorities had earlier detained Huawei CFO Meng Wanzhou at the behest of American authorities. This had prompted the Chinese authorities to issue a stern warning to the Canadians to release the CFO, or face consequences. The warning came in the face of the U.S. filing for the extradition of Meng. While the politicians resort to their own methods of settling the matter, companies in China are offering incentives to those employees who choose to buy Huawei smartphones instead of iPhones. It was inevitable that the trade war between the United States and China would come to impact Apple, which has its biggest manufacturing unit in China, not to mention, one of the most lucrative markets.
Zhang predicts that Apple will cut the production of the iPhone XR by some 2.5 million units for the March quarter while the iPhone XS and iPhone XS Max production could be reduced by 1 million and 500,000 units respectively.
Wall Street Journal had last month reported that Apple had cut down on the orders for both the iPhone XS and the iPhone XS Max as the company struggled to predict the demand for its most expensive iPhone lineup yet.
The trade war between the US and China isn’t the only reason for Apple to be taking a hit on their stock right now. The 2018 lineup is the most expensive iPhone lineup yet, with the highest end smartphone costing as much as a down-payment on a car. The iPhone XR offered a mixed-bag of features, in some ways, feeling like a huge step backwards even in comparison to the iPhone 8 or the iPhone 8 Plus. With the iPhone XR costing as much as an iPhone 8 Plus, the phone doesn’t even offer a dual camera setup.
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