Apple apparently has increased its iPhone orders beyond full production capacity of its contract manufacturer Foxconn (Hon Hai). The new order puts iPhone sales at four times of original estimates, approaches the smartphone sales volume of Nokia and may raise new concerns of the iPhone production environment.
According to TechCrunch, Apple is requesting 800,000 iPhone 3G units per week from Foxconn, which would translate to at least 3.2 million phones per month and close to 40 million devices per year. Apple sold about 6 million units of its iPhone Gen 1 and the company missed its original, somewhat blurry goal, to sell 10 million iPhones in its first year and hit a market share of about 1%.
Apple is obviously optimistic about its increased market reach to more than 70 countries, but a monthly volume of more than 3 million smartphones (we assume that Apple can actually sell all of these units) could be considered as impressive even by Apple standards. A volume of more than 12 to 13 million smartphones per quarter would make Apple the world??™s second largest smartphone manufacturer, just behind Nokia, which sold 14.6 million units in the first quarter of this year and well ahead of Research in Motion, which sold 4.3 million Blackberry phones in Q1, according to market research firm Gartner. Apple is estimated to have sold just 1.7 million iPhones during the first quarter.
Overall, a shipment volume of 12-13 million iPhones per quarter would not allow Apple to become a top 5 cellphone company. Nokia is estimated to ship about 120 million phones per quarter, followed by Samsung with 45 million, Motorola with 28 million, LG with 27 million and Sony Ericsson with 24 million.
The indication that Foxconn may be manufacturing iPhones above its current capacity levels is already creating concern about possible inhumane working conditions and overtime violations at Foxconn. Ryan Ritchey, producer of The Digital Lifestyle blog, suggested that Apple should check the working conditions at the company. "If there ever was a time that a precariously close to inhumane work environment could go over the edge, this new production ramp would be it," Ritchey said.
Source: TG Daily