China Business [Google translation] and China Times [Google translation] are reporting that last month alone, Apple returned at least five million, and as many as eight million iPhones to assembly partner Foxconn for defects in operation or appearance.
The reports indicate that it will cost Foxconn roughly 200 yuan ($32) per device to correct the issues with the defective iPhones, resulting in a charge of as much as 1.6 billion yuan ($259 million) to address the problem. It is unclear which iPhone models are affected by the issues, but Apple does not appear to be suffering from major shortages of any of its current devices.
The iPhone 5 suffered from quality control problems from its first day of release. A number of customers complained of scratches and other issues with their new device, straight out of the box. Foxconn officials stated the iPhone 5 was the most difficult device to assemble that they had ever had to deal with, as increased quality control standards led to lowered production output. It took Apple two and half months to achieve a supply vs. demand balance.
