Apple’s cost of making iPad drops
Print Edition
Apple seems to have trimmed the bill for making its latest iPad along with the tablet computer’s width and weight.
The iPad Air that sells for US$499 costs Apple US$274 to make, based on an analysis released by research firm IHS Inc. That’s a 13 percent drop from the estimated US$316 that it cost Apple to make the third-generation iPad unveiled last year.
The iPad Air went on sale last week. IHS buys various devices and then takes them apart to assess how much the parts cost.
“While the iPad Air slims down in size, the profit margins are getting fatter,” Andrew Rassweiler, IHS’s senior director of cost benchmarking services, said in a statement.
Apple declined to comment. But Chief Financial Officer Peter Oppenheimer assured analysts in a conference call last month that Apple “is going to work really hard to get down the cost curves” of its products.
The gap between Apple’s costs and the iPad Air’s selling price is even wider on models that offer more storage. For instance, IHS estimates the 32-gigabyte version of the iPad Air only costs Apple an extra US$8.40 to make yet sells for US$100 more than the 16GB model.
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