Market Overview

Foxconn Plant Reopens, Ending iPhone 5 Production Concerns

Foxconn Plant Reopens, Ending iPhone 5 Production Concerns

The plant, which is located in Taiyuan, was shut down temporarily after a riot broke out Sunday evening. According to the Associated Press, the brawl came as a result of increased working demands -- including longer hours -- which were brought on by the release of the iPhone 5.

Apple is attempting to turn its flagship device into the fastest-selling smartphone of all time. In order to accomplish this goal, the company needs to be able to produce an exorbitant amount of iPhones.

Eleven months ago, the iPhone 4S sold 37 million units during its first quarter of availability. To surpass the iPhone 4S by a meaningful margin, Apple would need to produce and sell at least 38 million units of the iPhone 5.

Whether or not that is actually feasible remains to be seen. Thus far, Apple has disappointed investors by selling 50 percent fewer devices than anticipated. The depressing sales are being blamed on supply constraints, but there are some signs that domestic demand has fallen short of expectations. While it is unknown why American consumers would suddenly lose interest in the iPhone brand, the new Maps App has received a number of complaints.

In Japan, iPhone users are already taking the opportunity to switch to other mapping applications.

When the iPhone 5 arrived in stores on Friday, September 21, Apple groupies waited in line for hours to purchase the new smartphone. Still, the crowds were not as massive as expected.

Investors responded to sales of the iPhone 5 -- which came in at five million over the weekend, well below estimates -- by abandoning the stock yesterday. In the process, Apple lost roughly two percent of its value. During pre-market hours this morning, the stock has continued to decline.

Follow me @LouisBedigianBZ

Posted-In: Apple Associated Press foxconn iPhone 5News Tech Best of Benzinga


Related Articles

View Comments and Join the Discussion!