Apple and Samsung Cut Phone Production in 2022 as Inflation Hits Hard

• Leading smartphone manufacturers, Apple and Samsung, are cutting their phone production this year.

• Apple cut production for only low to mid range devices but Samsung’s cut affected its flagship products.

• The production cut is due to falling demands amid high global inflation.

The world’s leading phone manufacturers, Apple and Samsung, have announced that they are cutting their phone production in 2022. Both companies have made this major decision as demand has decreased due to high inflation.

Apple’s production decrease will affect just low to mid-range prices. However, Samsung is said to have cut production for its flagship phone models, according to a Korean publication. 

In March, Apple announced that it was set to reduce the production of the iPhone SE by 20% in comparison to its original output plan. The company claimed that it decided to do that because the demand for mid-to-low range prices is decreasing due to high prices. The tech giant also claimed that the supply of parts has been disrupted.

The Korean publication quoted a representative of a Sansung partner saying:

 “Recently, Samsung Electronics received a call to reduce the order volume of smartphones from the current target of 310 million units to 280 million units.”

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A report from Shinhan Financial Investment also showed that Samsung Electronics recently cut its yearly smartphone production forecast for 2022 by 10% (about 270 million units). After producing 300 million units in 2017, Samsung stayed in the mid-to-late 200 million range. The electronic giant also set a goal of producing 300 million units this year before inflation hit.

Along with Apple and Samsung, smartphone part makers are also expected to take hits.  Samsung recently revised the order to reduce the amount of supply by up to one month to the parts maker. However, the company added that it will restore the reduced order volume when a new foldable smartphone is released later this year.

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