iPhone 7 More Expensive to Make Than iPhone 6s: IHS

iPhone 7 More Expensive to Make Than iPhone 6s: IHS
  • Total cost to manufacture the iPhone 7 mobile comes to $224.80
  • Apple retails an unsubsidised 32GB iPhone 7 at $649
  • iPhone 7's Bill Of Materials "in line" with flagships made by Samsung

Apple is spending more to manufacture its iPhone 7 smartphone than predecessor iPhone 6s due to features such as a bigger battery and larger storage capacity, according to a teardown by IHS Markit Ltd.

Including $5 in basic manufacturing costs, total cost to manufacture the iPhone 7 mobile rises to $224.80 (roughly Rs. 15,000), $36.89 higher than the business research provider's estimates for the iPhone 6s.

(Also see: iPhone 7 Teardown Reveals That 3.5mm Audio Jack Is Replaced by Barometric Vent)

Apple retails an unsubsidised 32GB iPhone 7 at $649 (roughly Rs. 43,500).

The company unveiled the iPhone 7 with high-resolution cameras and no headphone jack at its annual launch on September 7.

IHS Markit also said on Tuesday the iPhone 7's Bill Of Materials (BOM), a financial estimate of the raw materials used, was "in line" with flagship smartphones made by rival Samsung but Apple ekes out better margins.

(Also see: iPhone 7 Plus iFixit Teardown Reveals 3GB RAM)

"All other things being equal, Apple still makes more margin from hardware than Samsung, but materials costs are higher than in the past," said Andrew Rassweiler, senior director of cost benchmarking services at IHS Markit.

IHS Markit has not yet performed a teardown analysis on the larger iPhone 7 Plus.

Supplies of Apple's iPhone 7 Plus have been exhausted in all shades, and the smaller iPhone 7 has also sold out in the new jet black colour, the company said last week.

(Also see: iPhone 7, iPhone 7 Plus First Impressions)

Yet, in some markets, such as China, interest in the new phone has been muted, as cheaper local brands amp up their design and marketing.


© Thomson Reuters 2016


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