Soaring Component Costs For iPhone 15 Could Signal A Price Hike For iPhone 16

The latest iPhone, particularly the 15 Pro Max variant, has seen a significant spike in its component costs, which might indicate a subsequent increase in the pricing of the forthcoming iPhone 16.

What Happened: A recent report by 9to5Mac revealed that the titanium frame of the iPhone 15 Pro Max costs 43% more than its stainless steel predecessor. There’s also been a three-fold increase in the price of the 5x telephoto camera in comparison to the 3x module.

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The total cost of parts for the 256GB iPhone 15 Pro Max, based on an extensive report by Nikkei Asia and Fomalhaut Techno Solutions, is estimated to be $558, marking a 12% rise from the parts cost of the 256GB iPhone 14 Pro Max. For context, the total parts cost for comparable models between 2018 and 2021 ranged from $400 to $450.

Interestingly, the cost of NAND flash memory chips for internal storage has declined due to a slump in demand. Despite a doubling in memory capacity from 128GB to 256GB in the 15 Pro Max, the cost only surged by 5%.

Analysts were surprised when Apple Inc. AAPL decided not to transfer these cost increases onto consumers. However, the ongoing rise in parts prices suggests that the iPhone 16 lineup might be more expensive.

It’s important to remember that the parts cost doesn’t reflect Apple’s total expenses. The tech giant also incurs costs related to assembly, distribution, research and development, advertising, marketing, and other operational aspects.

Why It Matters: The iPhone 15 Pro Max came with major upgrades that resulted in a 12% hike in the component cost. This increase, combined with the fragility of the iPhone 15 Pro’s back glass, as reported earlier might have, might have contributed to the escalating parts cost. The back glass of iPhone 15 Pro, although cheaper to replace, is highly fragile and prone to frequent replacements, potentially adding to the increased costs. These factors might influence Apple’s pricing strategy for the iPhone 16.

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