Apple's 'iPhone 13' expected to launch with much higher prices

Posted:
in iPhone edited August 2021
Impending increases to the cost of component manufacturing may see Apple raising its "iPhone 13" prices to compensate.

Mockups of the forthcoming
Mockups of the forthcoming "iPhone 13" range


It's previously been reported that processor manufacturer TSMC would prioritize Apple, and the automotive industry, over other firms as the global chip shortage continues. However, TSMC is believed to be about to raise its prices -- and now Apple is expected to pass that increased cost onto consumers for the next iPhone.

According to Digitimes, unspecified sources in the supply chain say that TSMC is shortly to raise its quoted prices for sub-7nm technologies. The "iPhone 13" range is believed to be based on a 5nm processor, the A15.

Overall, TSMC is said to have notified customers of increases of up to 20%. However, the sub-7nm processors are to see increases between 3% and 10%.

The supply chain sources expect that Apple, which accounts for a fifth of TSMC's processor business, would see price rises of between 3% and 5%.

In all cases, the increases are said to come into effect from January 2022. Rather than only increase the "iPhone 13" price then, Apple is expected to launch with higher prices.

The current iPhone 12 is also based on a 5nm processor, so if Apple retains any models in its lineup, those may presumably face price increases at some point. Currently, the iPhone 12 is reportedly not seeing the usual slowdown in sales that are typical ahead of a new launch.

Digitimes has a poor history for predicting Apple plans, however its track record for information from industry sources is much stronger.

Read on AppleInsider

Comments

  • Reply 1 of 18
    mpantonempantone Posts: 1,939member
    If Apple is going to increase iPhone prices, they won't do it by tacking on +5% to cover. It'll be a more natural increase. A $799 model will go to $899, a $999 model will go to $1099.

    One thing is pretty clear: Apple will not keep prices the same. They are loathe to let their gross margins erode. That would happen in CY2022 once the semiconductor price increases kick in.

    If one clicks through the various hyperlinks, other foundries have already hiked prices: GlobalFoundries, Powerchip Semiconductor Manufacturing (PSMC), Semiconductor Manufacturing International (SMIC), United Microelectronics (UMC). 

    Source: Tom's Hardware

    My guess is that TSMC won't be the last either. This is a broad industry price increase based on increased material cost amongst other factors. 
    edited August 2021
  • Reply 2 of 18
    cpsrocpsro Posts: 3,062member
    Sounds like iPhone 12 models might not receive a price reduction. The 13 series will come in above them.
  • Reply 3 of 18
    davgregdavgreg Posts: 995member
    Inflation (regardless of what formula you use to calculate it) is being seen broadly, from labor and energy to raw materials and transportation.

    rinosaur
  • Reply 4 of 18
    Expected inflation with the trillions of newly printed money.
    steveau
  • Reply 5 of 18
    So the iPhone 13 is in production now but they’re going to raise prices on chips already delivered? Seems bogus.
    MplsPStrangeDays
  • Reply 6 of 18
    Apple has a contract with TSM to deliver a certain amount of A15 chips. The contract is most likely signed in 2020 with a price built in. 
    StrangeDays
  • Reply 7 of 18
    eightzeroeightzero Posts: 2,772member
    I'll not be upgrading. My Xr fulfills all my needs. For now.

    YMMV.
    MplsP
  • Reply 8 of 18
    MplsPMplsP Posts: 3,714member
    mpantone said:
    If Apple is going to increase iPhone prices, they won't do it by tacking on +5% to cover. It'll be a more natural increase. A $799 model will go to $899, a $999 model will go to $1099.

    One thing is pretty clear: Apple will not keep prices the same. They are loathe to let their gross margins erode. That would happen in CY2022 once the semiconductor price increases kick in.

    If one clicks through the various hyperlinks, other foundries have already hiked prices: GlobalFoundries, Powerchip Semiconductor Manufacturing (PSMC), Semiconductor Manufacturing International (SMIC), United Microelectronics (UMC). 

    Source: Tom's Hardware

    My guess is that TSMC won't be the last either. This is a broad industry price increase based on increased material cost amongst other factors. 
    A 'natural' increase of $100? What about $50 or $25? And will they then drop the prices once the supply issues resolve?

    I’m with the others - my Xs is working just fine. Looks like it will continue to work just fine for a few more years.
    edited August 2021
  • Reply 9 of 18
    That’ll be one more year using the 11 Pro for me to compensate for the price increase when I purchase the 14 series. 
    applesnoranges
  • Reply 10 of 18
    Heck, my 6s is still working fine.
    kingofsomewherehotDogperson
  • Reply 11 of 18
    wood1208wood1208 Posts: 2,815member
    TSMC said to increase price but didn't say for Apple so why people connecting to dots, making it up that it will effect this year or next year's Apple products ? Apple locks in design and the price of supply chain components, assembly etc months or year ahead.
    muthuk_vanalingam
  • Reply 12 of 18
    It would seem to me, with iPhone 13 already in production, that Apple's locked in pricing from TSMC and should not be a factor in retail pricing. Apple does love its margins, though, so we could see an increase anyway. Besides that, there are other parts of the iPhone that have likely evolved and maybe the cause of some of the inflation. I doubt we'll ever be privy to that data - and really, should we be? How many question the margins on clothing, food, jewelry, and other commodities - no one gets the kind of scrutiny that Apple does. As an Apple user since the '90s (which made my business possible) and an investor since the early days, I say……you go girl! ;-)
    Vermelhospock1234
  • Reply 13 of 18
    mpantonempantone Posts: 1,939member
    MplsP said:
    mpantone said:
    If Apple is going to increase iPhone prices, they won't do it by tacking on +5% to cover. It'll be a more natural increase. A $799 model will go to $899, a $999 model will go to $1099.

    One thing is pretty clear: Apple will not keep prices the same. They are loathe to let their gross margins erode. That would happen in CY2022 once the semiconductor price increases kick in.

    If one clicks through the various hyperlinks, other foundries have already hiked prices: GlobalFoundries, Powerchip Semiconductor Manufacturing (PSMC), Semiconductor Manufacturing International (SMIC), United Microelectronics (UMC). 

    Source: Tom's Hardware

    My guess is that TSMC won't be the last either. This is a broad industry price increase based on increased material cost amongst other factors. 
    A 'natural' increase of $100? What about $50 or $25? And will they then drop the prices once the supply issues resolve?

    I’m with the others - my Xs is working just fine. Looks like it will continue to work just fine for a few more years.
    I can't recall the last time the regular price for the basic iPhone came in at a price point like $_24 or $_49. They have usually been a dollar short of a one hundred dollar increment.

    Remember the iPhone 13 isn't just the iPhone 12 with components that are slightly more expensive in a uniform manner. COGS is different on each phone model. Almost everything has gotten more expensive in the past year, including materials like metal, plastic, and paper. Same with air freight and other services.

    Apple has already ditched the AC adapter in the iPhone box.

    There's also the impact of currency exchange rates. The value of the dollar is not fixed.

    As for Apple reducing the prices once the supply constraints ease up, I don't believe Apple has a regular history of making mid-model price changes on their hardware. 

    No one here knows what COGS is for any given piece of Apple hardware. 

    One thing for sure: Apple isn't going to slash gross margins. They have a duty as a publicly traded company to increase shareholder value.
    edited August 2021
  • Reply 14 of 18
    Wgkrueger said:
    So the iPhone 13 is in production now but they’re going to raise prices on chips already delivered? Seems bogus.
    So don’t buy one. Apple aren’t obligated to keep your wallet balance healthy. Their obligation in this matter is to maximize profit. Or did you forget that Apple is a company incorporated in a country based on capitalist principles?
  • Reply 15 of 18
    iPhone 11 here (from 6 plus before)  Was thinking to maybe go 13 pro max, if camera upgrades warrant it. But seems likely I’ll hold out another year from what I’m hearing so far.  This is a great phone and value, they’ll need a power feature to tempt me.
    applesnoranges
  • Reply 16 of 18
    fastasleepfastasleep Posts: 6,218member
    MisterKit said:
    Heck, my 6s is still working fine.
    Sure, if you don't care about the camera or performance at all. 
    p-dog
  • Reply 17 of 18
    fastasleepfastasleep Posts: 6,218member
    mpantone said:
    I can't recall the last time the regular price for the basic iPhone came in at a price point like $_24 or $_49. They have usually been a dollar short of a one hundred dollar increment.
    The 7 started at $649, 7 Plus started at $769.
    The XR started at $749.
    rbelizespock1234
  • Reply 18 of 18
    longfang said:
    Wgkrueger said:
    So the iPhone 13 is in production now but they’re going to raise prices on chips already delivered? Seems bogus.
    So don’t buy one. Apple aren’t obligated to keep your wallet balance healthy. Their obligation in this matter is to maximize profit. Or did you forget that Apple is a company incorporated in a country based on capitalist principles?
    I think you misunderstood what I wrote. 
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