Apple iPhone 5c production cut in half?
0. phoneArena 11 Oct 2013, 13:48 posted on
Seems like we've seen this show before; last January, week demand for the then flagship Apple iPhone 5 reportedly led Apple to slice production of the device in half. On Friday, a published report out of China said that the Cupertino based tech titan is cutting its daily producvtion of the Apple iPhone 5c by 50% due to "disappointing sales"...
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35. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
You don't work for Apple, so unless you had access to highly confidential numbers, it's hard to believe you knew what Apple's expectations are in the first place.
What we do know is that the wall street analysts blew their call on the 5C.
41. Sniggly (Posts: 6695; Member since: 05 Dec 2009)
If Apple didn't expect to sell all those iPhone 5c's, they wouldn't have wasted the money producing them. Want to see the photo I took of my full drawer of 5c's, which consists entirely of the initial shipment?
45. PapaSmurf (Posts: 7328; Member since: 14 May 2012)
Don't show it to him, because he'll just say it's fake.
iPhone 5C isn't selling. It's just another phone sitting in stores while the 5S is running out of stock.
47. Googler (Posts: 813; Member since: 10 Jun 2013)
Which means they won't be purchasing replacement stock. That's really where Apple is going to be hit, when holiday shopping orders aren't as big because of release stock still sitting on the shelves.
55. Mr.Verizon (Posts: 23; Member since: 12 Feb 2012)
That's where people are mistaken. Each carrier has a contact with apple. It's well known that in order to carry the iPhone you must agree to purchase a set amount of iPhones within a certain timeframe. How do i know this? At certain points over the past few years were told to focus solely on selling iPhones. Even though they are one of the lowest gross profit phones to sell. And I'm not talking right before a new iPhone launches but random times. This is the reason that quite a few European carriers won't carry the iPhone because of that contractual demand.
61. Googler (Posts: 813; Member since: 10 Jun 2013)
So what happens if they don't sell the specified amount?
72. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
Sniggly, you are responding the same way when I stated ZTE and Huawei will do well in a couple of years. You were in disbelief since the only ZTE or Huawei handsets you've seen were complete crap. Your mistake was your failure to look into the future.
You are making the same mistake now. Here's my advice, use your Droid Mini and look up the story of how the statisticians got the Dewey-Truman contest wrong. The statisticians had forecasted Dewey to be the winner. They got it wrong due to sampling error. You are making the same sampling error with the 5C as with the ZTE and Huawei.
58. Sniggly (Posts: 6695; Member since: 05 Dec 2009)
Just kidding, I'm going to show you anyway.
Here's all the 5c's from our one initial shipment a month ago, minus one or two full (10 count) boxes in a back cabinet.
Here is said cabinet after our shipment tonight. Now there's about six full boxes sitting there.
Plus here's what that drawer looks like now.
That's not to say we haven't sold any, but sales have just not come close to how many we have been sent by Apple.
Granted, a lot of those loose phones ARE the 32 gigabyte model, which I've seen even less interest in.
Come on, ardent, it's not so hard to admit you're wrong. If I can admit when I'm wrong, then you can too.
Believe it or not, it actually strengthens your credibility when you acknowledge evidence that you took the wrong position in an argument. I mean, hell, we all know you're a smart guy. You don't have to keep trying to prove that to us by trying to win unwinnable arguments.
73. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
You are one data point. A data point doesn't tell the whole story.
Here's a homework assignment for you -- all you have to do is look up old press releases from ATT, Verizon, and Sprint when they sold the iPhone. You will see a pattern, at launch, people tend to buy the newest and best model which in this case is the 5S. People will buy the older model as the months continues meaning sales of the older models should rival the best model. You know this to be true since the 4 and 4S did really well before the launch of the 5S.
Right now, with the 5C, it has to compete with existing stocks of the 5. Once the 5 inventory gets depleted where only the 5C, then look at your drawer. That is to say if the 5 wasn't available, the 5C would do better.
In business, this phenomenon is called overhang, and the correct way is to "normalize" the data as opposed to using the actual data. In statistics, the actual data contains too much noise. With the 5S with 64-bit processor, the overhang of the 5, there is too much noise in the 5C data to make any sound prediction.
Remember, not selling well now doesn't equate to not selling well in the future. The ZTE and Huawei devices are pretty damn good today versus 2 years ago.
76. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
Sniggly, I'll save some time -- you can read this link
81. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
I just recheck Apple's new release and you are full of crap.
Apple sold 9 million units of 5S and 5C over launch weekend. The estimates (by wall street firms) is about 25% of the sales are 5C. That would be over 2 million units. Apple would NOT release actual sales of 5C for competitve reasons.
We can debate whether or not over 2 million units over 3 days is massive sales.
The point is just because you failed to sell 5C's in your store, doesn't mean 5C's aren't being sold.
To be clear, my position has always been since Apple never told us (about 5C sales targets), we have no reasonable basis to discern whether actual 5C sales are hitting their bogey, the "iPhone 5 Overhang" notwithstanding. I have nothing to apologize for.
84. Sniggly (Posts: 6695; Member since: 05 Dec 2009)
Well, this is fun. I never got notifications for these responses.
For your information, though, there was virtually no overhang. Apple and Best Buy sought to eliminate it by giving really awesome trade in deals for the 5 prior to the 5s/5c launch. By the time the launch happened, we had barely a handful left. Now we have maybe two or three 5's in stock, some of them open items. People aren't coming in for either phone, and if the 5c were selling really well at other locations we'd get overflow from them looking to purchase it, like we do for the 5s, since we have 3 or 4 locations within fifteen minutes of our store, not counting standalone mall locations.
Apple missed badly with its internal sales estimates. There's no way to claim they didn't unless you're also prepared to declare that Apple deliberately manufactured way more 5c's than they intended to sell.
I agree that it's a small sample size, but it simply doesn't look good from this angle. You could be right; sales could magically pick up during the holidays when kids whine for the iPhone and parents get the 5c because there's no way they'll pay an extra hundo for the 5s.
16. Landmarkcm (Posts: 402; Member since: 11 Aug 2009)
Well to each there own right. Im a pretty new "isheep" lol as they say. I had briefly tried the 4s was on Sprint @ the time with that so im sure that didn't help the experience. But anyway Im happy with my blue 5C overall. I got a great deal on it. Best buy matched Targets price of 79.99 plus tax of course. Anyway one of the things that drew me to it was the Plastic and the colors which I actually prefer! I cant be the only one. It's not cheap plastic like some phones either. Also I know there's not much different over the 5 but the front camera is upgraded and ive read some say its a bit zippier still etc. Anyway like I said I dig the plastic & color options & think apple did good with it. That's why we have choice right.
34. PotDragon (banned) (Posts: 214; Member since: 22 Jul 2011)
You are the perfect apple candidate. Get the 5c but convince yourself it is "zippier". Convince yourself the plastic feels better...Apple plastic? Convince yourself the blue looks good and not like your phone is wearing crocs.
77. Landmarkcm (Posts: 402; Member since: 11 Aug 2009)
Lol! I don't have to convince myself of anything. I like the plastic look and colors better. Thats it. Its good that apple changed it up a bit with more options too. Now if they just make the screen abt 4.3 that would be the sweet spot for me.
78. Landmarkcm (Posts: 402; Member since: 11 Aug 2009)
Ya its prob pot "zippier" either and one thing ya did get right also crocs are ugly! lol :)
46. PapaSmurf (Posts: 7328; Member since: 14 May 2012)
Hint: iPhone 5 and the 5C have the exact same processor, so one is not "zippier" than the other.
20. jaxson983 (Posts: 38; Member since: 11 Aug 2013)
The 5C will be free with a new contract by December...its already down to $45. Prices don't normally get cut in half a month after they are released. So much for it being a margin builder.
28. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
If Walmart or Best Buys or Target wants to lose money on the phone -- that's their call.
The Retailer mark-up on the iPhones is about 10%. There's not a lot of room for discounting because Apple set it up that way.
54. rusticguy (Posts: 2818; Member since: 11 Aug 2012)
Walmart is already selling cheaper than what Apple wants them to. Apple is losing grip on whatever pricing control it did have earleir or maybe Walmart twisted Apple's arms to get a better pricing ...
74. ardent1 (Posts: 1991; Member since: 16 Apr 2011)
rusticguy, did you read the last paragraph?
“Honestly, it’s just our business model,” added McKinney. “We leverage our expenses so we can invest in price.” That seems to suggest Wal-Mart simply ignored Apple’s pricing preferences."
It's what I wrote earlier -- Walmart is willing to accept a loss or lower margins. It helps if you read and understood what the author is trying to communicate.