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10/10/2012
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iPhone 5 Supply Squeezed By Scuffgate Fix

Apple is trying to improve quality control practices along the iPhone 5 assembly line, which means it is taking longer to produce the new smartphone.

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Apple iPhone 5 Teardown: Visual Tour
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The iPhone 5's smashing debut weekend has come and gone, leaving supplies of the device tight in its wake. Apple sold more than 5 million in just a few days, and if you go to Apple.com today and try to order an iPhone 5, you'll have to wait three to four weeks.

That wait might get a little longer, however, now that Apple has taken measures to abate the Scuffgate problem.

Owners of the iPhone 5 reported scuffed devices coming brand new out of the box. Others noted that their device was easily scratched on the metallic surfaces. The iPhone 5 uses an aluminum housing that is anodized with black or white coloring. Aluminum is softer than the stainless steel that was used in the iPhone 4S/4 construction.

[ Apple may have its problems, but competitors are not taking advantage of them. Read BlackBerry 10 Launch: Is March Too Late? ]

Apple's official response to the issue was something along the lines of, "Hey, it's painted metal, and painted metal can be scratched. Deal with it." My words, obviously, not Apple's, but the message is the same.

According to Bloomberg, Apple has now applied stricter controls in its manufacturing process to solve this problem. Citing a source familiar with the situation, Bloomberg reported that Apple executives cracked down on Foxconn, which makes the iPhone 5, to "tighten production standards." Newer iPhone 5s will not have scratches when they are pulled new out of the box, and fewer of them will likely scratch when mishandled.

This is great news, but it comes at a cost: time.

The higher standards have slowed production, further constraining supply of the iPhone 5. In fact, Bloomberg notes the slowdown in production has left factories idle. In the U.S., it shouldn't be too hard to score an iPhone 5 if you want to go into an Apple store or carrier store. What's not clear is how the supply issues are affecting sales in other markets.

The problem has led to a decline in Apple's stock price. It was selling for $705 per share on September 21, the day the iPhone 5 launched. Today, Apple stock is trading at $640. The decline has erased $60 billion in value from Apple's market cap.

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User Rank: Apprentice
10/27/2012 | 12:32:09 PM
re: iPhone 5 Supply Squeezed By Scuffgate Fix
Funny, my Motorola DROID RAZR with it's Kevlar back has no scratches after almost a year being carried in my pocket, not in a case or with a screen or case protector. If Apple wasn't so secretive about its products perhaps they'd actually test them before they release them and they'd have discovered the antenna issues and that painted aluminum scratches. Ask any mountain bike user about scratches on aluminum frames.
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