Apple switching to Chinese suppliers for cheaper iPhone components

22 August 2018
Working with Taiwanese manufacturers is proving to be more expensive for the US company.

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  • Tucking_Fypo
  • 2Au
  • 22 Aug 2018

Anonymous, 22 Aug 2018are u out of yr mind.He certainly isn't. Clearly you are the one who is living inside a rock, come visit here in the Philippines and check what China has been doing on our territory (group of islands within Philippines). This and all the artificial Island that they had built around the seas surrounding them. What he had mentioned might sound a conspiracy, but that is what is going on right now mate. So go ahead and enlighten me/us that what he had mentioned is far from the possibility it might happen. Have a good day.

    So the average bill of materials for an iphone comes in around $300, iPhones which still retail at their release price 12 months later, unlike androids which depreciate due to severe competition, and ur cheapskating on production costs, i bet u dont pass these savings onto the customer with your trillion dollar company, glad to never be part of that overhyped gravy train

      Anonymous, 22 Aug 2018Yes, but when you pay for a device, you don't just buy the ... moreNot to mention the massive scale of the company. It's bloody huge. I honestly get why they have such a high profit margin..

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        • S6 User
        • nFX
        • 22 Aug 2018

        Anonymous, 22 Aug 2018Yes, but when you pay for a device, you don't just buy the ... moreYou said, 'So there you have Apple making $50 pure profit out of each $1000 phone sold.'

        Please provide proof that Apple make $50 (5%) on their £1,000 phone.

        It was ~ 64 to 69% in November 2017 this profit margin will have increased now that initial investments like R&D have been recovered & most of us know about aggressive tax avoidance:

        https://www.reuters.com/article/us-apple-iphone/apples-iphone-x-has-higher-margin-than-iphone-8-analysis-idUSKBN1D62RZ

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          • .alpha
          • ytx
          • 22 Aug 2018

          Most cellphone production are in China now so cost be lower over there is common sense.

            • k
            • kent
            • NL@
            • 22 Aug 2018

            o boy......wait till Trump sees this.........lololol

              • ?
              • Anonymous
              • FXM
              • 22 Aug 2018

              Wait, wasn't Trump going to bring jobs back to America?

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                • Anonymous
                • 39x
                • 22 Aug 2018

                Android Consultor, 22 Aug 2018Where did you see that? Because, according to Dxomark, Iph... moreAs much as i dislike apple.. the picture quatily is more real to life than the p20 pro.. which is over saturated and sharpened..
                It looks like if you wack your tv up to 50% sharpeness gets worse when you zoom in..
                Only other phone that seem to do a better job is the sony xz2 premuim.. and personal i think thats only in low light..
                People.. seem want to think over contrasted and saturated pictures.. look good.. as if were looking at billboards.. high in the sky tryih to get your attention.. but the real to life of the photo.. quatily.. seems to be lost...

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                  • Koala
                  • p@5
                  • 22 Aug 2018

                  Anonymous, 22 Aug 2018Taiwan is as much a province of China as The Ukraine is a p... moreWhat the hell are you talking about? Ukraine is an independence country. It was part of USSR but never province of Russia.

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                    • Nzi97
                    • tu6
                    • 22 Aug 2018

                    Droidtard, 22 Aug 2018If you're getting tired. Then stop reading articles and new... moreGetting a little tic there buddy, don't worry, i will still givlve my money to apple, my work flow force me to

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                      • Anonymous
                      • uw4
                      • 22 Aug 2018

                      apple reducing price
                      you serious?
                      https://media0.giphy.com/media/u31fedwl4J7G0/200w.gif

                        • ?
                        • Anonymous
                        • 3pL
                        • 22 Aug 2018

                        Anonymous, 22 Aug 2018Odd. Do you know that Huawei is a Chinese maker and Samsung... moreTaiwan is as much a province of China as The Ukraine is a province of Russia.

                          • ?
                          • Anonymous
                          • gKJ
                          • 22 Aug 2018

                          Anonymous, 22 Aug 2018Odd. Do you know that Huawei is a Chinese maker and Samsung... moreTaiwan is independent for all intends and purposes aside from China's wishful thinking. Try importing something from Taiwan to mainland or visa versa and see if customs officials agree with your claim. Or better yet, try going to Taiwan as a PRC citizen and see for yourself if it's as easy as crossing say from Jilin into Liaoning province.

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                            • Dump4prison
                            • GRZ
                            • 22 Aug 2018

                            Kangal, 22 Aug 2018Where did you get that from? Usually hardware gets cheaper... moreFaux news Minion.... Muh illegals!!!

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                              • Anonymous
                              • MwH
                              • 22 Aug 2018

                              Anonymous, 22 Aug 2018SmaRT waking from your Apple comaYes, but when you pay for a device, you don't just buy the components. You pay for a lot of other stuff which made the device possible.

                              And yes, Apple (iPhone X) for example:

                              $250 components and accessories
                              $250 research and development
                              $150 taxes
                              $70 quality assurance
                              $50 packaging, shipping and distribution
                              $30 for 24/7 customer support
                              $200 gross profit out of which: $60 reinvested in R&D for future phones, $40 invested in modernising facilities, $20 spent on replacing faulty devices, $20 spent on lawsuits against other manufacturers who copy their products, $10 spent on replacing stolen goods from stores/delivery services, and finally $50 pure profit.

                              So there you have Apple making $50 pure profit out of each $1000 phone sold. Anyone who owns a business which comes up with new and original, premium products, knows the costs associated with all the above.


                              Why other manufacturers can offer cheaper phones? That is because:

                              $50-$150 components and accessories
                              $10-$80 research and development (they copy all their designs from other companies such as Apple and thus they only need to adapt them to their needs instead of creating them from zero)
                              $15-$70 taxes
                              $5-$30 quality assurance
                              $5-$30 packaging, shipping and distribution
                              $1-$5 for customer support
                              $20-$100 gross profit out of which: $5-$30 invested in R&D for future phones, $2-$15 invested in modernising facilities, $0-5 spent on lawsuits, $5-$20 spent on replacing faulty devices, $1-5 spent on replacing stolen goods, and finally $8-$25 pure profit.

                              And here you have pure profits of $8 from $100-$110 devices, and pure profits of around $25 from $450-$500 devices.

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                                • Bewildered
                                • 39x
                                • 22 Aug 2018

                                Bewildered , 22 Aug 2018The Mate 20 has not even been released yet FYI Apple a... moreMy bad $ 1 trillion has Twelve zeros that is only a Billion
                                A trillion is. One thousand Billions $1,000,000,000,000

                                  Basicly china phone with apple logo on it

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                                    • Bewildered
                                    • 39x
                                    • 22 Aug 2018

                                    Droidtard, 22 Aug 2018Apple's quality getting low? iPhone X has the most premium ... moreThe Mate 20 has not even been released yet

                                    FYI Apple are the first and only trillion $ company i.e $ 1,000,000,000

                                    Apple also benefitted from Trumps tax reduction 35% to 20% by storing their cash overseas in foreign bank accounts

                                    The tax only becomes payable when the money is moved to US bank a/c so absolutely no tax was paid by Apple whilst the money was in these bank a/cs

                                    So whilst every one else's tax was being used for e.g defense, natural disasters hurricane, wild fires reducing the budget deficit.. O.k you get it

                                    Additionally Apple enter an illegal tax evasion ploy with Ireland, where Apple world sales were registered in Ireland, Ireland only collected tax on sales made in Ireland.

                                    The EU regulator found out that Apple paid ZERO tax on these sales evading €13 billion

                                    Here is the funny part Ireland refused to collect this tax and it is now being taken to cout

                                    As you can see collection by Ireland admits that it was illegal, so why secret deal and why only Apple has this deal in place

                                    Going back to the American taxation to avoid double taxation a company pays the net amount. Ireland already has a low corporate tax rate of 12.5 %, so it's liability when moving the cash to US soil is 35% minus 12.5% ie 22.5 % old tax rate and 7.5% Trump tax

                                    So you have the €13 billion unpaid to Ireland, a saving of 15% due to the tax reduction, even if the tax was due in 2008, until it hits a US bank it is a deferred tax

                                    Now I am not a geek but I understand that sweeteners were offered to all multi nationals in order to bring this income back to the US, so they didn't even pay in Apple case the 7.5%

                                    The notion that Apple needs to reduce cost is a joke

                                      Anonymous, 22 Aug 2018Odd. Do you know that Huawei is a Chinese maker and Samsung... moreThats so wrong . Taiwan is stand alone country .

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                                        • Anonymous
                                        • IbE
                                        • 22 Aug 2018

                                        Anonymous, 22 Aug 2018Odd. Do you know that Huawei is a Chinese maker and Samsung... moreThe best phones are made in USA and Europe.

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