The iPhone 12 is more expensive to produce than its predecessor, the iPhone 11. According to the Counterpoint survey, Apple spends up to $ 415 ($ 340) to manufacture each unit, which is $ 87 more than for the iPhone 11. This increase in production cost is explained by the integration of an AMOLED screen, a 5G modem and an SoC engraved in 5 nm.
True to form, the analysis firm Counterpoint was interested in the production cost of iPhone 12. The study focuses on the standard model of iPhone 12, which we tested. To produce a single unit (with 128 GB of storage), Apple invests 415 dollars, or 340 euros. Last year, the production cost of the iPhone 11 was estimated at $ 328, or 21% lower.
To explain this inflation, Counterpoint first points the finger at the price of the A14 Bionic SoC which powers the iPhone 12. Engraved in 5nm by TSMC, the chipset costs an additional 17 dollars compared to the A13 of the iPhone 11 (which was engraved in 7nm). The etching process is unsurprisingly more expensive.
On the same subject: the iPhone 12 is number 1 in sales in October, ahead of the Galaxy Note 20 Ultra
Why has the cost of producing iPhones increased?
Then, the report highlights the price of the 5G modem provided by Qualcomm, the Snapdragon X55. This modem costs $ 15.3 more than the 4G LTE modem of iPhone 11. The American founder also supplies the transceiver and the radio frequency components that accompany it.
The switch from LCD to OLED also played a role in increasing the cost of production, Counterpoint notes. This year, Apple is indeed using OLED panels supplied by LG and Samsung on all models in its lineup. The iPhone 12’s OLED display costs $ 23 more to produce than the LCD panel that covers the iPhone 11.
Under these conditions, it will come as no surprise that Apple has increased its prices compared to the previous generation. If the iPhone 11 was offered at a price of 809 euros when it was launched in 2019, the iPhone 12 is priced at 909 euros. To compensate for this umpteenth increase, Apple has enriched its range with a cheaper model (809 euros), the iPhone 12 Mini. Despite its low starting price, this small iPhone is shunned by consumers.
Source: Counterpoint
