Apple Increase Payments to Foxconn to Increase iPhone 6 Plus Profits

With Apple already having sold a monumental amount of 10 million combined units of its current flagship devices in the first week since the devices were launched; the Cupertino company is looking to increase the payments that it gives to international electronics contract manufacturing company Foxconn by 20 percent in order to combat the disparity of supply quantities that has been created between the iPhone 6 and the iPhone 6 Plus. The company is going to increase its payments given to Foxconn in order to start assembling a larger batch of the iPhone 6 Plus.

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Another reason why the company has decided to pay Foxconn more is because China and its consumers have started to display profound interest in Apple’s iPhone 6, particularly the 5.5 inch screen model, forcing Apple’s hand by increasing the larger screen variant’s supply yield. Thanks to the boom in demand coming from China, analysts predict that the iPhone 6 Plus will account for 60 percent of the total iPhone 6 shipments in the future.

According to CEO of Apple, Tim Cook; the company is not even close to having a balance between the two models, but he still has faith that the company’s suppliers will be able to deliver what the company has proposed and bring both devices’ supply yield to an equal amount. According to other rumors and their estimates, Foxconn is able to make a $20 profit for each iPhone 6 Plus sold. Now that the tech behemoth is raising its payments by 20 percent, the supplier will be able to make $24 per iPhone 6 Plus sold.

The raising of the payments will no doubt be temporary, with Apple to resume the regular assembling contract price of the devices once the balance of supplies for both devices evens out.

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