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Foxconn Raising Prices on Apple?

Reuters briefly reports on a note from Citibank analyst Chang Kaiwei claiming that Apple manufacturing partner Foxconn and its parent company Hon Hai are preparing to raise the prices they charge to their customers for manufacturing devices such as the iPhone.

Hon Hai, the world's largest electronic parts maker, will raise prices from October for some clients, including Apple, according to a Citibank analyst, a Taiwan newspaper reported on Wednesday.

The move, said to be designed to boost quarterly profits for the firms, is also said to affect Nokia, Microsoft, and Sony Ericsson.

It is unclear how much of a price increase Hon Hai is targeting, and thus whether Apple will be able to maintain its existing pricing for its customers or if it will be forced to pass along some of the increase. Apple will presumably make every effort to maintain its current price points, and its healthy gross margins should offer the company some flexibility in this regard, although any change in Apple's cost situation would likely have an effect on Apple's forward-looking financial guidance and investor sentiment.