One of the most remarkable things about the iPhone 14 series is the price. Despite rumors claiming the iPhone 14 Pro models will be more expensive than their predecessors, Apple kept the iPhone 13 price structure in place for another year. The iPhone 15 price might be another story, however. Apple might have to increase the entry cost in response to the rising costs of key components.
TSMC is the sole manufacturer of A-series and M-series chips that power the iPhone, iPad, and Mac. The Taiwanese chipmaker will raise prices in the coming months, with a report claiming that Apple has agreed to it. Previously, a report said that Apple rejected TSMC’s price hike proposal.
Estimates indicate Apple accounts for a quarter of TSMC’s yearly revenue, which gives the iPhone maker plenty of bargaining power. But TSMC is also Apple’s only supplier of System-on-Chips (SoC) like the A16 Bionic in the iPhone 14 Pro models. Or the M2 versions that equip the new MacBook Air and upcoming Pro models.
Moreover, TSMC will likely produce the A16 Bionic that will power the iPhone 15 and iPhone 15 Plus models next year. The iPhone 15 Pro and iPhone 15 Pro Max will reportedly get the A17 Bionic SoC.
In late September, reports said that TSMC planned a price hike of 6% to 9% starting early next year. That’s the price hike that Apple reportedly rejected initially.
A new report from Economic Daily News implies that Apple has agreed with the TSMC price hike. The same source detailed the chipmaker’s plan to charge its customers more money for the silicon it makes.
TSMC’s decision makes sense in the current landscape. The ongoing inflation and the risk of recession will undoubtedly impact the cost of manufacturing goods, including smartphones like the iPhone 15 series.
Moreover, TSMC will start manufacturing 3nm SoCs for some of its clients, Apple included. This is a brand new, more advanced process that could lead to price increases. The A17 Bionic chip that will power the iPhone 15 Pro models should be a 3nm processor from TSMC.
TSMC’s decision to increase the cost of chips could lead to a price hike for the iPhone 15 models. But it’s unclear whether all variants will be more expensive than their iPhone 14 equivalents.
TSMC manufacturing costs aside, insiders already claim that the iPhone 15 Pro and iPhone 15 Pro Max (Ultra) will not be identical. The latter might pack additional features. As a result, Apple might charge a higher base price for it.
Finally, we’ll note that Apple had already increased iPhone 14 prices in other regions. For example, European buyers have to pay slightly more for the new iPhone this year. But that’s a move tied to the stronger dollar than manufacturing costs.
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