iPhone production is expected to take a holiday hit as China’s Covid rules continue to mess with supply

Tuesday, November 8, 2022 by Robinhood Snacks |
iMessage from Santa: “I might be late” (George Frey/Getty images)

iMessage from Santa: “I might be late” (George Frey/Getty images)

An iPhone under the Christmas tree… may be harder to come by this holiday season. Apple warned of lower iPhone shipment volumes for the year as production snags dampen its outlook. It’s reportedly expecting to churn out at least 3M fewer iPhone 14s than previously anticipated. The hardware heavyweight began selling its iPhone 14 line in September, but sales have swiftly cooled. Two reasons:

  • Underwhelming demand: Consumers aren’t splurging as much on fancy gadgets, which explains weaker demand for Apple’s pricey Pro offerings. Last month Apple reported record quarterly sales, but iPhone revenue was softer than expected.
  • Overwhelming rules: China’s zero-Covid policy has messed with Apple’s production this year. The latest snafu: the main iPhone assembly site, in Zhengzhou (aka: “iPhone City”), is under a weeklong Covid shutdown. Apple said customers should expect longer wait times.

Everybody talks… Last week there were rumors flying about when China would end its strict Covid restrictions (think: locking visitors inside Disneyland). Chinese stocks surged on speculation that authorities could lift some measures earlier than expected. The rumor mill may’ve boosted some US stocks, too, since so much production depends on China. Now investors aren’t so optimistic: on Sunday China reported its highest # of new Covid infections in six months (4.4K). Chinese health officials said they would stick with their strategy.


No one puts China in a corner… except maybe China. The world’s second-largest economy is putting blockers in front of its own growth, and fourth-quarter GDP is already hitting speed bumps as Covid rules depress demand and productivity. But the US and corporate titans like Apple can’t just brush that off as a “China problem.” Since the US imports more from China than any other country, it’s an everyone problem — that only China can tackle.