While it does brag impressive features under the hood, the iPhone XS is an incremental 'S' upgrade for Apple. However, the company did introduce a new 6.5-inch iPhone XS Max. This is a new big for Apple since the introduction of the iPhone 6 Plus. Apart from the impressively large display, the iPhone XS Max comes with an equally impressive price tag. You have to wonder what it costs Apple to make the iPhone XS and iPhone XS Max. Apparently, less than half of the baseline model. Let's see some more details on the cost.
iPhone XS Max Costs Apple $443 To Manufacture
Apple unveiled three new iPhone models at its big Gather Round event on September 12. iPhone XS Max, the company's gigantic flagship with a 6.5-inch display is priced at $1,049 for the entry level variant; the iPhone XS is priced at $999 and the soon to be released iPhone XR will be available at $749.
Now, according to the data gathered by TechInsights, the iPhone XS Max with 256GB costs Apple $443 in parts and assembly compared to $395.44 for last year's iPhone X. Let's see the complete breakdown of cost per component.
As for the display, Apple has managed to cut some costs and keep expenses low by removing components related to the 3D Touch. The display on the iPhone XS Max costs $80.55 in contrast to $77.27 for the iPhone X.
The relatively small increase in cost despite the larger screen size was because Apple appeared to have removed some components related to its so-called 3D Touch system, which makes apps respond differently depending on how hard users press the screen.
“All told, what they took out adds up to about $10, so this $80 estimate would have been about $90,” Al Cowsky, who oversees cost analysis at TechInsights, told Reuters in an interview. “They had a trade-off in cost.”
The modem cost is slightly higher for the iPhone XS Max as the company made a shift to Intel from Qualcomm. In addition to this, the tech involved in the 7nm processor adds up to the expense. The stainless steel frame on the iPhone X was also one of the major contributors in cost and since the new iPhone XS Max features the same, we presume the case is the same this year as well.
As for the remaining parts and assembly costs, the 256GB variant of the iPhone XS Max costs $443 and Apple sells the device for $1,240. However, we do have to consider the research and development costs along with marketing.
There will be more to the story, so be sure to stay tuned in for more details on the matter. What are your thoughts in the iPhone XS Max pricing strategy? Let us know in the comments.