February 20, 2015
With the release of its new Apple Watch line slated for April, Apple has reportedly ordered five to six million units to meet anticipated first quarter demands. The order accounts for all three models, which includes the Apple Watch, Watch Sport and Watch Edition. According to close sources, Apple’s order primarily consists of the Apple Watch Sport and Apple Watch Edition models. It plans to up the production of its Watch Edition in the second quarter to exceed one million units per month.
The Wall Street Journal reports that “half of the first-quarter production is earmarked for the entry-level Apple Watch Sport model, while the mid-tier Apple Watch is expected to account for one-third of output.” The company will increase production of the more luxurious model, the Apple Watch Edition with 18-karat gold casing, in the second quarter.
Apple’s commitment to such a large order of its watches is indicative of the company’s forecasting practices. “Apple sets production plans based on its forecast of demand for the new product. But Apple quickly adjusts these plans if sales are different than what it estimated,” WSJ reports.
Apple predicts its collection of watches will exceed sales of other wearables currently on the market. This includes offerings from LG, Samsung, Motorola, and Sony. Android Wear-powered smartwatches, according to research firm Canalys, moved only 720,000 units in the last six months of 2014.
The Apple Watch Sport will sell for a base price of $349. The Apple Watch Edition on the other hand, will most likely surpass the costs of even Apple’s most expensive products, like the $4,000 Mac Pro computer.
The One Feature a Great Smartwatch Needs, Wired, 2/18/15