Apple to Postpone Production of 2020 Flagship iPhones

Published April 28th, 2020 - 11:00 GMT
Apple to Postpone Production of 2020 Flagship iPhones
They cited the delays Apple has faced since the coronavirus pandemic began. (Shutteerstock)
Sources said Apple is delaying production of its 2020 iPhones by one month.

Apple is reportedly pushing back the production of its flagship 2020 iPhones by about a month.

The tech giant has experienced delays due to the coronavirus pandemic that closed its factories in China earlier this year.

Citing ‘people familiar with the plans,’ the report notes that Apple is set to release four new smartphones this year, according to The Wall Street Journal.

The devices will come in three different sizes, one will be 5.4 inches, two at 6.1 inches and another model is 6.7 inches – some of the handsets will support 5G.

Apple has steadily unveiled the new iPhone models in September for years.

In order to hit the mark, the firm must start ramping up production early in the summer and building the inventory by August.

However, the firm’s factories in China were forced to close down in February due to the coronavirus spreading the country and production came to a standstill.

Although Apple would still be building some of the new phones in the July-to-September period, the mass-production ramp-up will slide back by about a month, the people familiar with the matter told The Wall Street Journal.

But these sources also said that the firm is reducing the number of smartphones for purchase by 20 percent.

The delay of the flagship smartphones has been predicted by investors and analysts as early as February.

Earlier this month, Goldman Sachs suggested Apple may not release the iPhone 12 models until early November.

While Apple's primary assembler, Foxconn, says that it will be ready to meet the demand for Apple's typical September launch, factors in other parts of Apple's supply chain may hinder that timeline.

As noted by 9to5Mac, suppliers in China have been significantly affected by lockdowns created by the COVID-19 outbreak.

Additionally, Apple has voiced concern about whether consumers will be willing to buy a premium phone as the economy worsens and many have their salaries reduced or lose their jobs entirely.

Goldman Sachs said it expects iPhone shipments to drop 36 percent during the third quarter due to coronavirus-related lockdowns around the world and downgraded Apple Inc stock to 'sell.'

The brokerage firm also predicted that the average selling prices for consumer devices are likely to decline during a recession and remain weak well beyond the point when units recover.

'We do not assume that this downturn results in Apple losing users from its installed base' a Goldman Sachs analysts said in a note 

'We simply assume that existing users will keep devices longer and choose less expensive Apple options when they do buy a new device.'

Though Goldman Sachs downgraded Apple's stock, the tech giant's recently released budget device could help keep sales relatively stable.

Earlier this month, Apple revealed a smaller iPhone priced at $399, lowering the starting price for the company's smartphone line to broaden its appeal among budget-conscious customers.

© Associated Newspapers Ltd.

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