Apple’s iPhone maker confident of meeting surge in Duo demand

• Hon Hai, also known as Foxconn, expects its 240 sites in 24 countries to help meet strong demand for Apple’s US$2,000 (S$2,600) iPhone Duo.
• The new foldable phone sold out in stores quickly, and some online orders face delivery dates as late as the end of January.
• Foxconn says AI will lift gadget demand, while its business is shifting away from Apple towards cloud, networking and Nvidia-powered server growth.

Apple’s main assembly partner Hon Hai Precision Industry expects its expansive global manufacturing presence will help it fulfil growing demand for the US company’s marquee foldable device. 

The US company launched the US$2,000 (S$2,600) iPhone Duo earlier in October.

The limited in-store stock was sold out quickly, while some online orders were offered delivery at the end of January, marking some of the lengthiest delays for a new Apple product in the company’s modern era.

The Duo is now primarily assembled by Hon Hai, also known as Foxconn, in the Taiwanese company’s “iPhone City” campus in central China. The company also makes components for Apple in other facilities in China and beyond. 

“We have over 240 sites in 24 countries all over the world, which enable us to have a timely supply to our customers’ demand whenever they need. So I’m quite confident that we can fulfil the demand,” Hon Hai’s rotating chief executive officer Michael Chiang told Bloomberg TV, when asked about meeting holiday season orders for the Duo.

Chiang added that he thinks AI will boost demand for consumer gadgets.

While Chiang did not refer to Apple or iPhone Duo by name, he plays a critical role in coordinating business between Foxconn and the US company.

When Apple chief operating officer Sabih Khan visited Foxconn’s facility in central China in October, Chiang accompanied him on a tour of the iPhone Duo production line. 

Hon Hai chairman Young Liu has been fostering his potential successors through the rotating CEO programme. Chiang, seen as a rising star within Foxconn, assumed his new role in April. 

Like many of its hardware peers in Taiwan, Hon Hai’s business has undergone a transformation in the AI era.

Apple used to account for more than 50% of its revenue, but that is no longer the case. Hon Hai’s cloud and networking unit contributed to 51% of its total sales in the second quarter, a sign that AI-related hardware is what is driving the company’s growth now. 

Hon Hai is scheduled to showcase the latest Nvidia-powered server offerings on Oct 30 at its annual flagship event, and it is also expected to unveil its new electric vehicle line-up. BLOOMBERG