Executive Briefings

Asian Suppliers Confident That Price for New iPhone Will Mean Good News for Them

The debut of the iPhone 6 wasn't just a big moment for Apple. It marked a major event for manufacturers in Taiwan and elsewhere in Asia that make the components for the device.

Asian Suppliers Confident That Price for New iPhone Will Mean Good News for Them

Before the launch, many observers worried that Apple might repeat the mistakes of the iPhone 5S and 5C. With prices too high for many consumers, the last round of iPhones had limited upside for the Asian supply chain.

The announced prices of the iPhone 6, which start at $199, have brought some cheer to investors who follow Apple’s supply chain. The new phone has “a larger screen, bigger battery, more storage, so from a bill of materials perspective, that is more expensive,” Barclays analyst Kirk Yang said on Bloomberg Television. “People were a little bit worried it could be more expensive, but it came out at the same price.” That, he added, is “actually quite good for the Asia supply chain.”

Hon Hai, also known as Foxconn, is likely to be the biggest beneficiary, with 65 percent of the orders for the smaller phone and nearly all the orders for the larger one, according to Yuanta Financial. Pegatron is likely to receive 20 percent of iPhone orders next year, according to analysts Sherman Shang and Calvin Huang of SinoPac Securities.

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Before the launch, many observers worried that Apple might repeat the mistakes of the iPhone 5S and 5C. With prices too high for many consumers, the last round of iPhones had limited upside for the Asian supply chain.

The announced prices of the iPhone 6, which start at $199, have brought some cheer to investors who follow Apple’s supply chain. The new phone has “a larger screen, bigger battery, more storage, so from a bill of materials perspective, that is more expensive,” Barclays analyst Kirk Yang said on Bloomberg Television. “People were a little bit worried it could be more expensive, but it came out at the same price.” That, he added, is “actually quite good for the Asia supply chain.”

Hon Hai, also known as Foxconn, is likely to be the biggest beneficiary, with 65 percent of the orders for the smaller phone and nearly all the orders for the larger one, according to Yuanta Financial. Pegatron is likely to receive 20 percent of iPhone orders next year, according to analysts Sherman Shang and Calvin Huang of SinoPac Securities.

Read Full Article

Asian Suppliers Confident That Price for New iPhone Will Mean Good News for Them