Apple factories reducing iPhone 5C output

Apple is winding down orders for the iPhone 5C as manufacturers report the final three months of the year will see less of the devices produced.

Sources familiar with Apple’s supply chain told Reuters that it has informed its two largest iPhone 5C suppliers, to expect low demand from Apple for the device in the remaining three months of the year.

Pegatron Corp has seen orders for the iPhone 5C reduced by less than 20 per cent according to an anonymous source, with the Wall Street Journal reporting that Hon Hai Precision Industry Co has seen orders reduced by a third for the same period of time.

Analysts have continually criticised Apple for its pricing policy on the recently released iPhone 5C with many complaining the difference between it and the iPhone 5S is too small to make it a success.

"This reflects a failure in Apple's pricing strategy. The price differentiation between 5C and 5S is too small. It's an iPhone 5 with plastic casing and isn't worth the price," said Bevan Yeh, a Taipei-based senior fund manager at Prudential Financial Securities Investment Trust.

Though this conflicts with the views of other analysts that say the unclear nature of Apple’s supply chain makes it churlish to read too much into the cuts.

"We've seen this several times. There are too many moving parts in the supply chain to draw any conclusions," said Benedict Evans, mobile and digital media analyst at London-based Enders Analysis. "We don't know what other suppliers they use or what inventory they already have."

Apple released the iPhone 5C alongside the top of the range iPhone 5S at twin events in Beijing and California last month with the company announcing it achieved its best sales ever in the first weekend with nine million devices shipped.