Huge iPhone 5 Demand Choking Us: Foxconn

iPhone 5 hit by supply issues, which could hit Christmas stock.

‘Design related difficulties’ is at the heart of the delays Apple manufacturer Foxconn, known locally as Hon Hai, are experiencing during the production of the thinner, longer 4″ iPhone 5.

“Market demand is very strong, but we just can’t really fulfil Apple’s requests,” Hon Hai Chairman, Terry Gou, admitted this week.

“It’s not easy to make the iPhones. We are falling short of meeting the huge demand,” he told reporters.

Foxconn’s production lines has already been mired by delays while making i5, quality control issues over design defects, scratching, as well as HR headaches including staff protests and fighting.

Foxxconn employs 1.3 million personnel in its China factories. And no doubt the pressure to meet demand from Cupertino is immense.

The third party supplier, Apple’s biggest, has been cracking the whip with Chinese production staff to up output of the iPhone 5, which is far more difficult than previous models to assemble.

The move could throw uncertainty over Apple iPhone 5 supply prior to the peak Christmas period and points to a major weakness in Apple’s supply chain as it depends largely on a third party to make its much sought after hardware, compared to rival Samsung who makes it own devices.

Demand for Apple’s latest phone had been gung-ho, breaking records of its first weekend of sale, last month, where it sold 5 million, which starts at $799 – outstripping previous demand for 4 or 4S.

“The iPhone 5 is the most difficult device that Foxconn has ever assembled. To make it light and thin, the design is very complicated,” a company official previously said.

 “It takes time to learn how to make this new device. Practice makes perfect. Our productivity has been improving day by day.”