Apple and its suppliers are apparently preparing for a significantly lower demand as a result of the increasing spread of the novel coronavirus in western countries and the resulting massive social and economic consequences.
As the Reuters news reports, Apple’s suppliers and manufacturing partners are currently experiencing a significant drop in orders from the US computer giant. For the first quarter of 2020, for example, one of Apple’s contract manufacturers is already expecting orders to decline by around 18 percent compared to the previous year.
Because Apple apparently expects significantly lower sales, the company has apparently postponed the start of production for the components of the new iPhone 5G models, according to the same source. However, this does not necessarily mean that Apple is also postponing the introduction of the new devices so that launch in autumn is currently still expected.
Dropped Forecast Ahead
It was reported earlier that iPhone 12 could be delayed for months due to the current crisis and according to the report, Apple’s display suppliers are also assuming significantly lower quantities. The company has now reduced its previous forecasts for the construction of iPhone displays by 17 percent and expects that instead of the previously planned 70, only 58 million panels will be delivered to Apple.
The situation in the financial sector has been very similar to date: leading analysts have already lowered their forecasts for the sale of iPhones for the current quarter by 17 percent weeks ago so that only 35 million units are currently expected in the first quarter of 2020. In fact, the demand for expensive electronic products – and this includes iPhones – should continue to decrease with a further increase in infections with the novel coronavirus. As a result of the pandemic, many customers may simply not have the financial means to buy an expensive smartphone due to job cuts and, in some cases, high medical costs, or should at least temporarily postpone their new purchases.