We all know the IPhone 5 is the hottest item to have right now, but how has this IPhone differed from those of the past? This time around Apple decided to design the phone with a thinner, lighter touch screen. This however, lead demand to outstrip supply on the IPhone big debut weekend. This is the first time Apple is using in-cell screen technology whose components are made by LG and Japan Display Inc. This new technology change was the first time since 2010 and helped sell over 5 million new phones in just three days. The problems arose due to the fact that they needed to produce a lot of product and get it to all their distributors and this more than likely did have some impact on the quality of the phone. The IPhone accounts for 2/3 of Apples profit and a successful debut was critical this time around.
It has been a challenge for LG to keep up with the demand for parts since Japan Display has not yet started shipping out their products due to quality changes they are still working on. As one analyst put it “Apple is struggling to keep up with demand”. This is a huge problem for Apple who relies on its suppliers to be able to keep up with the demand from their customers.
Many analysts are saying these constraints will be short lived due to the fact that Apple spends so much money on these components they will be the first in line to have orders placed and shipped. Apple is these companies best customer and they will do whatever they can to make sure they keep up with Apples demand for parts. The problem now arises if Foxconn Technology Group in China will have the labor needed to be able to keep up with demand when it comes to actually assembling the phones and shipping them out to stores around the world.