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Apple will likely implement a price hike on its iPhone 16 release next year. This will follow the apparent increase in the production spending of Apple for the iPhone 15 lineup, which reportedly has a 10% pricier top-tier model than its predecessor in 2022.
A week ago, media outlet Nikkei shared a teardown of the iPhone 15 models, which revealed the cost of what Apple spent for the lineup. According to the report, the iPhone 15 Pro Max, which boasts some of the biggest hardware upgrades, has a $558 cost for its materials.
In particular, compared to the iPhone 14 Pro Max materials, the teardown review shows that the iPhone 15 Pro Max’s display is 10% pricier. Meanwhile, the titanium frame and the A17 Pro chip, the biggest highlights of the model, are reportedly 43% and 27% more expensive than their counterparts. As expected, the camera improvements made in the iPhone 15 Pro Max have also led to higher material cost, with the report claiming it is 3.8x more costly.
In general, the accumulated costs of the different materials in the iPhone 15 Pro Max translate to a 12% higher price compared to the materials in the iPhone 14 Pro Max. Meanwhile, iPhone 15 Plus and iPhone 15 Pro have lower percentages at 10% ($442) and 8% ($523), respectively. The base model of the series, the iPhone 15, has a $423 material cost estimate, making it the highest increase at 16% among the group.
Prior to this discovery, it was rumored that Apple would implement a price hike in the iPhone 15 lineup. However, during the unveiling of the models, Apple announced that it technically wouldn’t do that. Instead, it just removed the 128GB of the iPhone 15 Pro Max, making the 256GB the minimum storage option for the model. With this, customers are forced to pay $1,199 as the starting price point for the top-tier model, which is $100 higher than last year. Then again, it still couldn’t be considered a price hike as the number matches last year’s price with the same storage.
Unfortunately, it is unknown if this will still be the case next year, especially now that iPhone production costs are getting more expensive for Apple. According to Nikkei, while Apple fears the hike could affect its sales, it would experience consequences if it continues to prevent an actual price increase. That would be true, especially if the company would introduce bigger hardware upgrades for the iPhone 16 lineup.
“The pricing decisions seem to suggest that Apple’s management is cautious about price increases that might impact sales,” the report notes. “However, if Apple continues to forgo passing on increased costs to consumers, the company’s bottom line will eventually take a hit. Fomalhaut CEO Kashio says Apple might try to raise prices next year with models other than the Pro Max. Some 11 months from now, when Apple unveils the iPhone 16 series, more focus than ever before will likely zero in on the tech giant’s pricing strategy.”