Apple Reducing iPhone 13 Production Due to Chip Crisis

BY Rajesh Pandey

Published 2 Dec 2021

iPhone 13 Pro Rear

The semiconductor shortage and supply-chain disruption have created a demand-supply imbalance leading to extended shipping times for the iPhone 13 series. Now, due to prolonged chip shortage, Apple is cutting iPhone 13 production by 10 million units.

Apple initially expected to produce 90 million iPhone 13 units in the last quarter of the year. However, with key suppliers like Broadcom and Texas Instruments not able to deliver components on a timely basis, the company is reducing its production target. While Broadcom supplies Apple with wireless chips, Texas Instruments is a supplier of display parts related to the OLED panel. Apple is also facing component shortages from other suppliers.

Apple diverted several chips and components meant for the iPad Pro to the iPhone 13 manufacturing line in a bid to produce more units ahead of the important holiday season. However, that does not seem to be sufficient as the chip crisis has further worsened, with lead times for some extending to nearly five to six months.

The Apple Store in the US currently lists most of the iPhone 13 models for delivery only after Christmas, with the products also not being available for in-store pickup. Apple has already lost around $6 billion in revenue in the previous quarter due to the chip crisis, but it looks like things will only worsen for it.

Apple is not the only company battling the semiconductor shortage. In fact, it is still doing reasonably well, with other companies being affected even more. The crisis has also affected automakers like Ford, Toyota, and Chevrolet, who have had to stop production in their factories for a few days due to the shortage.

[Via Bloomberg]