Several rumors say that Apple is working on four new iPhone 5Gs for 2020, with production costs that could increase from $30 to $100 depending on the model. However, according to analyst Ming-Chi Kuo, Apple may not significantly increase the price of 5G iPhones.
The iPhone 11 Pro and iPhone 11 Pro Max models start at $999 and $1,099 respectively, while the iPhone 11 starts at $699. In a research note made for TF International Securities, Kuo (via MacRumors) states that Apple aims to offset the cost of 5G by reducing supply chain costs, including upfront payments for suppliers who will work on 5G-related components. Apple should also be able to contain the costs of so-called “non-recurring” engineering.
“Non-recurring” engineering refers to the one-off cost of researching, designing, developing and testing a new product or component. Kuo believes that Apple will move this research and development more within the company and not do so to third party suppliers.
While the payment of non-recurring engineering has often helped Apple’s suppliers stay afloat when iPhone sales begin to slow down during the spring and summer of each year, Kuo believes this will be less essential in 2020, because Apple could begin to release new iPhones two different times of the year.
Kuo finally confirms that the iPhone 5G will have a redesigned metal structure very similar to the design of the iPhone 4 with flatter edges.