Apple Slashes iPhone 5 Parts Production: Nikkei

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iPhone 5

Apple has halved its orders with suppliers of iPhone 5 parts recently, said the Wall Street Journal and  the Nikkei, a leading Japanese newspaper.

Apple cut orders on LCD panels from its original plan of about 65 million units in the first quarter.  And it also scaled back orders for other components, said the Nikkei, citing sources familiar with the situation.

The iPhone 5, released in September, has seen increasing competition from Android phones such as the Samsung Galaxy S, whose global sales have exceeded 100 million since launch in May 2010. Of the Galaxy S3 alone, Samsung has sold more than 40 million units in 7 months.

A Galaxy S IV is expected to be released within months, says Reuters, possibly sporting an unbreakable screen, with high definition resolution at 440 pixels per inch, and a faster processor. Samsung’s popular Galaxy Note II has also been a formidable competitor to the iPhone.

Samsung now has a lead in sales over Apple that some expect to widen.

Apple supplier Japan Display is expected to temporarily cut Apple screen production by 80 percent from Q4 levels, said the Nikkei, while a Sharp plant dedicated to iPhone 5 LCDs will trim output by about 40 percent in January/February.

Analysts began reporting last month of production cuts by iPhone suppliers, prompting to ask if the iPhone has peaked.

Source: Reuters, The Wall Street Journal

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