Foxconn, the Asian firm that assembles Apple's iPhone 5, has admitted that it can't produce the devices fast enough to keep up with orders. The supply shortage could explain why sales of the iPhone 5 haven't met analyst expectations.
Reuters reported, "Taiwan's Foxconn Technology Group said on Wednesday the company's flagship Hon Hai unit is finding it difficult to cope with the massive demand for Apple Inc's iPhones. 'It's not easy to make the iPhones. We are falling short of meeting the huge demand,' Foxconn Chairman Terry Gou told reporters after a business forum."
Lorraine Luk from The Wall Street Journal quoted an unnamed company official who added, "The iPhone 5 is the most difficult device that Foxconn has ever assembled. To make it light and thin, the design is very complicated." The official continued, "It takes time to learn how to make this new device. Practice makes perfect. Our productivity has been improving day by day."
InformationWeek's Eric Zeman noted, "One factor in the availability of the iPhone 5, at least when sales started, was the difficulty in manufacturing the iPhone 5's in-cell touch display. Sharp, in particular, had difficulty getting good yields of the display. It has since corrected that issue." Zeman added, "The materials used by Apple in the iPhone 5 are part of what is causing the problem, according to Foxconn. It uses aluminum for the back and side shell and an anodized effect for the paint and coloration. This combination is more prone to scratching."
Sam Oliver from Apple Insider observed, "Sales of the iPhone 5 have been held back by limited supply since the device launched in September. Apple itself said the company has been 'completely blown away' by consumer demand for the device."