iPhone 15 Teardown Reveals Record High Component Costs, iPhone 16 Could See Price Hike

Apple faced record high iPhone production costs for the second consecutive year.

  • The iPhone 15 Pro Max production cost received a 12% increase from the predecessor.
  • The iPhone 15 Pro Max production cost stood at USD 558.
  • Apple could pass on increased component costs to customers next year.

When Apple introduced the new iPhone 15 series, it did not increase the retail price for any of the models in the United States despite all the upgrades offered. This is expected to change next year with the iPhone 16 release due to record-high iPhone component costs. It has been revealed by an iPhone 15 teardown shared in a new Nikkei Asia report.

iPhone 15 Pro Max Component Costs Increased by 12%

The report mentions the iPhone 15 series teardown was done with the help of a research company Fomalhaut Techno Solutions based in Tokyo. They took entry-level variants for all four models: iPhone 15, iPhone 15 Plus, iPhone 15 Pro, and iPhone 15 Pro Max.

The iPhone 15 Pro Max production cost was found to be USD 558, a 12% increase over the iPhone 14 Pro Max. The report says production costs for the Max devices have ranged between USD 400 and USD 450 from 2018 to 2021. It means Apple saw record-high production costs increase for the second consecutive year.

The Cupertino-based tech giant introduced a new Tetraprism camera module on the iPhone 15 Pro Max which helps it deliver 5X optical zoom. It cost USD 30 to the company which is a huge increase of 280% than the previous generation. It further opted for a Titanium frame over stainless steel which increased the production cost by 43%. The newly used A17 Pro cost USD 130 and resulted in a cost increase of 27%. All these changes mean the iPhone 15 Pro Max’s cost-to-price ratio now stands at 47% which is a 1% increase over the predecessor.

The component price increase was seen across all iPhone 15 models. The vanilla iPhone 15 registered a USD 423 production cost, an increase of 16% as compared to the iPhone 14. The iPhone 15 Plus and iPhone 15 Pro cost USD 442 and USD 523 respectively to make. This is an increase of 10% and 8% respectively to their respective predecessor models.

Apple is said to have been absorbing these increased production costs and not passing them on to customers. This is why iPhone 15 series retail prices were unchanged from the last year. The only difference is the discontinuation of the 128GB variant for the Pro Max model. It means buyers now have to pay more to own the iPhone 15 Pro Max as 256GB storage is the entry-level variant now.

The report says Apple’s bottom line will eventually take a hit if it continues absorbing increased production costs. This is the reason it is believed we could see iPhone 16 series prices going up. If this happens, it will surely skyrocket iPhone 16 prices in India where customers are already facing increasing prices with the iPhone 15 series.