Most of the factories in China that supply devices and components to Apple are back to churning out products, but Apple suppliers are said to be worried about how much demand there will be for the current iPhone models and the new iPhones expected in the fall.
According to Reuters, a senior official at one of Apple's major supply companies said that orders for quarter ending in March are likely to drop 18 percent compared with the previous year. Production ramp-up for new 5G iPhones has also been postponed, though the official said it is still possible iPhones could launch as scheduled.
"No one is talking about manpower or material shortage (in China) anymore. Now everyone is looking at whether demand from U.S. and Europe could keep up," said the person, who has direct knowledge of the matter. "The focus now is the demand from consumers in the U.S. and Europe."
An Apple display supplier that had anticipated shipping 70 million iPhone displays to Apple is considering lowering that target to 58 million as well as reducing the workforce at its Apple production lines in Vietnam.
One supplier in Malaysia, a country now facing shutdowns, says that things are changing "on a day by day basis" because of ongoing supply chain disruptions.
Some suppliers are not expecting a drop in demand, however. An iPhone sensor supplier told Reuters that the current quarter was better than last year, and that the second quarter will also likely see a higher volume of shipments. "We are still producing as per the forecast given to us," said the source.
A report from Nikkei earlier this week suggested that Apple is considering delaying the 2020 iPhone launch by months, but that no decision had been made yet. The same report suggested that some suppliers have been asked to defer mass production schedules for two to three months, which is also mentioned in Reuters' report.
DigiTimes this morning said that suppliers who make printed circuit boards for the iPhone had not been asked to postpone volume production for components designed for the 2020 iPhone, so there seem to be mixed reports coming from the supply chain at this time.
A week ago, Bloomberg said that the iPhone 12 models are still on course for a fall launch, so whether there will be changes to Apple's typical September iPhone launch plans remains to be seen.
