Manufacturers of Apple Watch began small-scale production
last week, but they faced difficulties in reaching satisfactory production
performance.
After starting small scale production, the company
encountered disappointing quality with finished assembly, according to the
report. People who spoke to Nikkei attributed the production delay to a new,
complicated design, including a new blood-pressure sensor and water-resistance
features.
Apple typically releases new Apple Watch and iPhone models
in September or October, although the company has not yet announced a release
event for this year. Apple doesn't release Apple Watch sales numbers, but it is
the largest component of Apple's wearables division, which reported $30.62
billion in sales in 2020.
The report highlights the engineering challenges that Apple
faces every year when it ramps up massive production lines ahead of a fall
release to ensure that there's enough supply of new gadgets to meet Apple's
prodigious demand after launch, while keeping its product release plans secret.
The Nikkei report gave no indication Apple might postpone
its new Apple Watch launch, although it said that it might affect Apple's plans
after the new watches are unveiled.
Apple has a rigid prototype production system that
continually builds larger numbers of unreleased products to work out assembly
problems in the months before new products launch. After Apple designs a new
product, its engineers fly out to contracted factories in Asia to work out
problems in manufacturing to ensure that the company can build millions of
devices in short time frames while adhering to the company's quality standards.
In the past, Apple has faced production issues that have
affected fall launches, although the company doesn't typically comment on its
operations.
Last year, during the pandemic which snarled travel to Asia,
two iPhone 12 models were released in October and two other models were
released in November, both weeks later than Apple's typical schedule. In 2017,
Apple released a major iPhone redesign called the iPhone X, which was in short
supply in the weeks after its November release after reports suggested that
there were production issues with its facial recognition camera called Face ID.
Apple stock was flat during trading on Tuesday. Suppliers of
parts for the Apple Watch were mixed. Qualcomm, which sells cellular modems to
Apple, was up less than 1%.
Apple declined to comment.