Reference News Network reported on January 11 that US Apple has decided to reduce the first-quarter production of three newly released iPhone models by 10%, and its impact has expanded to areas such as electronic components and machine tools. Including Japanese companies, the stocks of related companies have all fallen since October 2018, and the impact has also affected machine tool orders. Due to the sluggish performance of iPhone in China, the world's largest smartphone market, the global "Apple economic circle" is shaking.
According to a report on the Nihon Keizai Shimbun website on January 10, the high-end route of the new iPhone with a maximum price of more than 10,000 yuan has kept many consumers away. In Japan and the United States, sales of new models are not as good as older, lower-priced models, and consumers’ replacement cycles continue to lengthen.
The stock market is depressed
reports pointed out that Apple’s stock price has fallen by 35% from the highest point in October 2018, and the total market value as of the 8th dropped to 715.4 billion U.S. dollars, a shrinkage of nearly 400 billion U.S. dollars from the peak (more than 1.1 trillion U.S. dollars) Dollar.
reported that investors’ selling also extended to stocks of related companies such as electronic components manufacturers. The market value of 10 companies that were greatly affected by Apple, including , Micron Technology, , etc., shrank by about 20% during this period, from a total of 690 billion US dollars to 540 billion US dollars.
Ethan Harris, an economist at Bank of America Merrill Lynch, pointed out that "Apple's downturn can be seen as a warning to the economic prospects of the United States and China."
affects Japanese companies
The impact also affects Japanese companies. On January 9, the Japan Machinery Industry Conference announced that the full-year order volume is expected to drop by approximately 12% year-on-year.
Tsuneo Murata, chairman and president of Murata Manufacturing Co., Ltd., said, "Demand for mobile phones began to grow weakly around the autumn of 2018." Some Japanese analysts believe that LCD panel manufacturer Japan Display (JDI) "factory operations from January to March will become very severe" and the prospects for its business reconstruction will be even more uncertain.
Assembling companies adjust manpower
China, as the iPhone assembly base, has also begun to adjust its employment.
reported that Taiwan’s Hon Hai Precision Industry has implemented a manpower adjustment of 100,000 people since the fall of 2018. Pegatron United Technology's Shanghai factory stopped recruiting new employees at the end of December 2018, and more than 1,000 employees have resigned.
Cook: The downturn is temporary
"I believe this is temporary," Apple CEO Tim Cook made this statement on the iPhone's sluggish performance on the US economic program on January 8. According to a brand influence survey in China conducted by
US market research company, Apple, which ranked fifth in 2017, dropped to 11th in 2018. Some analysts believe that Apple will launch a 5G terminal with significantly updated functions in 2020 and realize its revival strategy through new services such as video.
Apple is still the dominant market force
According to a report from Taiwan Juheng.com on January 9, Apple is still the dominant force in the market.
reports that Apple has always been a must-have asset for most investment portfolios. Even with its dramatic sell-off, Apple remains key to the tech sector and the broader stock market's dynamism, which means the tech giant could be an accurate sentiment indicator even as it loses its title as the most valuable public company.
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