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Apple Forced To Make Production Cuts To Vision Pro Headset

Apple are being forced to make major cuts to the production forecasts for the Vision Pro headset which was unveiled last month after being under development for seven years.

Due to the scaling back of target, the headset design has become complex and production has reached difficulties, all the while there are plans currently for a more affordable version of the device. These plans have been pushed back.

Apple have claimed the headset will not go on sale until “early next year,” with the launch taking place on June 5th. Many are speculating this has to do more with supply chain problems, rather than developers having time to create apps for the headset.

It has been reported that Apple and Chinese manufacturer Luxshare, are preparing to make under 400,000 units next year. Two other China-based sole suppliers for the Vision Pro claim Apple was only asking for enough for 130,000 to 150,000 units for the first year.

These suggest a significant cut is being made to production, with an internal sales target of 1mn units in the first 12 months. These indicate Apple’s lack of confidence when it comes to scaling production, following years of missed deadlines with the launch of devices.

Sales forecasts for the Vision Pro are varying widely, ranging from the low hundreds of thousands to several million in the first year. At the time of the unveiling, it was predicted that Apple would ship around 150,000 units in the first year, with others saying 850,000 and 5mn shipments respectively.

One of the major hurdles for the device are the sleek screens, consisting of two micro-OLED displays, and an outward-facing, curved “lenticular” lens, with the inward displays offering a resolution that exceeds all others in the market, and the outward lens can project the eyes of the wearer to the outside.

It has been reported that Apple is unhappy with the suppliers’ productivity, especially when it comes to micro-OLEDs that are free of defects.

“A lot of this is normal growing pains. This is the most complex consumer device anyone has ever made.”

It was implied that the higher than expected pricing meant that Apple was baking in the cost of production inefficiencies.

“Someone has to pay for that. I think Apple went into this with a lot of ‘bad yield’ built into the model. There is a lot of technology in the Vision Pro and they knew it would take a while to scale up. Apple knows they won’t make money on this in the first year.”

Sony have been cautious about how much the market for mixed-reality headsets would expand, resulting in a reluctance to step up production.

“We will be watching to see how much demand [for micro-OLED displays] will increase. But I don’t think we will be aggressive [in producing] in the same scale as image sensors.”

Apple are already working on later generation of the Vision Pro, which includes a more affordable version expected to appeal more to mass-market consumers.

The company is also working with Samsung and LG on a second-generation headset, and are exploring other display technologies such as mini-LED in order to drive the price lower.

It was reported however, that Apple are insisting the use of micro-OLED although suppliers have failed to match expectations so far.

The 2024 forecast cuts have disappointed Luxshare which had plans to build almost 18mn units annually in the coming years.

“Apple has not made a better product than the industry imagined . . . the manufacturers’ confidence is not high.”

Despite setbacks, Apple are believed to surpass a user base of 20mn within five years.

“Given the limited production numbers, it will be flying off the shelves, pre-ordered by Apple’s loyal fans and high net worth users in the US.”

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