Is Apple’s OCD Behind iPhone 5 Delays?

Apple (NASDAQ:AAPL) has asked Foxconn to tighten quality control measures while manufacturing the iPhone 5 after complaints of scratches on the device’s body, and that has worsened its supply shortfall. Stricter benchmarks are affecting production of the anodized aluminum housing used in the device, delaying orders for the phone, Bloomberg said.

Apple consumers started complaining of nicks and scrapes to the body of the new phone soon after its launch last month, with some saying there were scratches even before the device was unpacked. While the company said in response to the complaints that it was “normal” for an aluminum product to “scratch or chip with use, exposing its natural silver color,” internally, it expressed its displeasure to Foxconn.

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The scrapes are reportedly due to Apple using a different kind of aluminum that makes the smartphone thinner and lighter. However, this also means that every step of the production process offers opportunities to scratch the soft metal exterior. While the anodized aluminum is the same material that is used in Apple’s notebooks, scratches on the iPhone are more noticeable because of the contrast between the outer color and underlying metal. It also makes the phone’s body less prone to cracks than the glass casing of the iPhone 4 and iPhone 4S.

“The iPhone 5 is not easy to put together because it’s a minimalist design,” Sterne Agee analyst Shaw Wu said in a research note. “Apple has a very high standard, where it aims to produce each model to be an exact replica where variance is measured in microns.”

Foxconn workers, Bloomberg said, are finding it difficult to produce enough units of the device meeting the new standards. The added pressure on assembly line workers may also have resulted in the recent dispute at a Zhengzhou factory, with 4,000 employees reportedly walking off the job in protest. The supply slowdown is worrying investors and analysts, several of whom have cut their sales forecasts for the quarter.

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