Apple Halts iPhone XR Supply Over Weak Demand

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Citing unnamed sources, the Nikkei Asian Review reported on Monday that the company would halt plans for additional production lines for its new iPhone model, sending shares of the smartphone manufacturer's suppliers across Asia lower. Even more alarming, the report claimed that overall production might drop by as much as 25%.

Apple had initially informed Foxconn to set up almost 60 assembly lines for the iPhone XR. And if you liked smaller devices, the iPhone XR is actually the second-worst Apple phone to replace your old phone with - the iPhone XS is narrower, at 2.8 inches versus 2.98.

But, if Nikkei and its supply-chain sources are accurate on any level, it would appear that Apple's 2018 iPhone pricing strategy may be backfiring.

Wall Street analysts say that while Apple's subpar guidance for the coming quarter is one factor, the company's announcement last week of the change in unit sales disclosure has been especially rattling to investors.

Apple did not immediately respond to a Fortune request for comment on the report. Similarly, with iPhones no longer launching on a set schedule these days (with last year's iPhone X launching in November and the iPhone XR launching in late October of this year), a random 12 week snapshot of iPhone sales is not almost as instructive as it was years ago.

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While Apple had great expectations for the iPhone XR, it's now ordering more iPhone 8 and 8 Plus models from its partners.

With regards to the growing uncertainty caused by the US-China trade disputes, Tung said Pegatron, being a technology company with global deployments, does not see it necessary to relocate its production capacity completely out of China, noting that a 3% capacity relocation might be sufficient.

Starting at $749, Apple's new iPhone XR has been touted as a wallet-friendly option for those who want a new Apple smartphone.

Of course, given how new the iPhone XR is, along with the fact that Apple recently made a decision to withhold its quarterly iPhone sales figures, we may never actually know how well or how poorly an iPhone model is selling again. Someone in Cuba would have to work 608.4 days to afford the iPhone XS and 669.3 days to pay off the iPhone XS Max.

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