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Chip shortage may force Apple to cut iPhone 13 production by 10 million units

Apple may slash the number of iPhone 13s it will make this year by up to 10 million because of the shortage of computer chips amid a worldwide supply chain crunch that led the White House to warn that “there will be things that people can’t get” at Christmas.

Apple was expected to produce 90 million units of the new iPhone models this year but has told its manufacturers that the number would be lower because chip suppliers including Broadcom and Texas Instruments were struggling to deliver components.

The shares of Apple fell 1.2% in after-hours trading on Tuesday, reflecting broader falls in the US stock market and in Asia amid impact from Covid and supply chain problems.




In July, Apple forecast slowing revenue growth and said the chip shortage, which had started hitting its ability to sell Macs and iPads, would also crimp iPhone production. Texas Instruments also gave a soft revenue outlook that month, hinting of chip supply concerns for the rest of the year.

It is the latest sign of the serious bottlenecks affecting the flow of global trade as the chaotic economic recovery from the depths of the Covid-19 pandemic causes a shortage of energy, components, finished goods, labour and transportation.

Along with technology companies, car makers have been among the worst hit by the shortages, particularly of semiconductors with an estimated 7.7 million fewer vehicles being built this year. Many US factories have put production on hold this year due to a lack of parts.



Energy shortages and soaring power prices have led to shutdowns in factories in Asia’s large manufacturing centres such as China and South Korea in recent weeks, compounding already critical delays throughout the global logistics system.