Foxconn chairman Terry Gou says company is ‘falling short’ of iPhone demand

According to a report from Reuters, citing a statement from Foxconn Chairman Terry Gou, Apple’s assembler is having a hard time keeping up with iPhone 5 demand. Gou confirmed previous rumors that the company is indeed “falling short” of meeting supply for iPhones and its other unit, Foxconn International Holdings, is assisting with production:

“It’s not easy to make the iPhones. We are falling short of meeting the huge demand,” Foxconn Chairman Terry Gou told reporters after a business forum.

Following the launch of the iPhone 5, reports claimed employees at Foxconn’s Zhengzhou plant went on strike over quality control concerns and lack of training. The same quality control issues were linked to scratching found out of the box on some iPhone 5 units, but it’s unclear how much these setbacks have contributed to iPhone 5 delays. Another unnamed executive speaking to The Wall Street Journal last month said the iPhone 5 is “the most difficult device that Foxconn has ever assembled. To make it light and thin, the design is very complicated.”

To speed up production of new iPhones, specifically the production of display components, Reuters suggested Apple could provide cash incentives to Sharp, one of its keep suppliers that was thought to have contributed to initial low supplies. Following rumors yesterday that Apple might even be considering making further investments in the failing company, Asymco’s Horace Dediu (via Fortune) speculated today that a $2.3 billion discrepancy in Apple’s 2012 financials might have already went to Sharp: Read more

Foxconn official says iPhone 5 supply shortages caused by complicated design, productivity improving

The Wall Street Journal spoke with an unnamed Hon Hai executive today about why the iPhone 5 is experiencing supply shortages, and the Taiwanese manufacturer, also known as Foxconn, apparently blamed it on the smartphone’s complicated design and its subsequent assembly process.

“The iPhone 5 is the most difficult device that Foxconn has ever assembled. To make it light and thin, the design is very complicated,” said the executive to the Wall Street Journal. “It takes time to learn how to make this new device. Practice makes perfect. Our productivity has been improving day by day.”

The official did not wish to be named, but he admitted Hon Hai is attempting to better production capacity while apply more procedures to alleviate the reports of damages such as scratches to the iPhone 5’s metal casing.

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