Is reduced iPhone 5 demand behind Foxconn’s hiring freeze?

Is reduced iPhone 5 demand behind Foxconn’s hiring freeze?

Apple’s largest manufacturing partner, Foxconn Technology Group, has suspended recruitment of new hires, but the company said the decision was not related to production of the iPhone 5.

In an email statement, Taipei-based Foxconn said the hiring freeze was enacted after more employees returned from the Chinese New Year break than expected. The company denied a Financial Times report that said the hiring freeze was related to slowing iPhone 5 demand.

“Due to an unprecedented rate of return of employees following the Chinese New Year holiday compared to years past, our company has decided to temporarily slow down our recruitment process,” Foxconn’s statement reads. “This action is not related to any single customer and any speculation to the contrary is false and inaccurate.”

The Financial Times on Wednesday reported that the hiring freeze was implemented amidst slowing demand for the iPhone 5. The freeze “underscores the weakening demand for some Apple products, which has put pressure on the US company’s battered share price,” the paper said.

An Apple spokeswoman did not immediately respond to a request for comment.

During an appearance at the Goldman Sachs Technology and Internet Conference last week, Apple chief Tim Cook was asked if there is a limit to Apple’s potential iPhone market share gains. Cook responded in a very Apple fashion, arguing that the word limit is not “in the Apple vocabulary.”

During a January earnings call, meanwhile, Cook downplayed reports that Apple had slimmed down its iPhone orders. Cook said he didn’t want to comment on specific rumours from the Wall Street Journal and Nikkei (“I would spend my whole life doing that,” he said), but encouraged people to “question the accuracy of any rumour about build plans.”

“Even if a particular data point were factual, that doesn’t tell the whole story,” he said. “It would be impossible to actually interpret as to what it meant for our overall business.”

Even if iPhone production is slowing, iPad mini manufacturing appears to be in full swing. According to Digitimes, AU Optronics topped 1 million panel shipments for the smaller tablet, and is working on panels for Apple’s next-gen iPad mini.

Leave a comment on this article

Topics