Kuo: Next Year's 5G iPhones With Redesigned Metal Frame Won't Have Major Price Increase

Apple is rumored to launch four 5G-enabled iPhones in fall 2020, and while 5G-related components could raise the production costs of the devices by $30 to $100 depending on the model, analyst Ming-Chi Kuo believes Apple will not significantly increase the price of 5G iPhones compared to this year's lineup.

iPhone 11 Pro and iPhone 11 Pro Max models start at $999 and $1,099 respectively in the United States, while the iPhone 11 starts at $699.

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In a research note with TF International Securities, viewed by MacRumors, Kuo said Apple instead aims to offset the cost of 5G by reducing its supply chain expenses, potentially including dropping its upfront non-recurring engineering payment to suppliers of the redesigned metal chassis and frame for 5G iPhones.

Non-recurring engineering refers to the one-time cost to research, design, develop, and test a new product or component. Kuo believes Apple will shift more of this research and development in house.

While the non-recurring engineering payment has typically helped Apple's suppliers stay afloat when iPhone sales start to slow during the spring and summer each year, Kuo believes it will be less essential in 2020 and beyond since Apple is expected to start releasing iPhones on a biannual basis going forward -- lower-end iPhones in the spring and higher-end iPhones in the fall.

Kuo has previously claimed that 5G iPhones will sport a redesigned metal frame with an iPhone 4-like design, suggesting a return to flatter edges. In today's note, he said both the chassis and frame on 5G iPhones will cost Apple significantly more to manufacture, perhaps pointing towards an even more premium design.

Related Forum: iPhone

Top Rated Comments

fmcshan Avatar
57 months ago
The iPhone 4 design is still perhaps the best to date. Anyone else agree?
Score: 51 Votes (Like | Disagree)
Freida Avatar
57 months ago
I think instead of biannual they should do biennial. The tech has matured so having a new iPhone every 2 years would do much better for everyone. Also less waste overall :-)
Score: 20 Votes (Like | Disagree)
EugW Avatar
57 months ago
1. It should have NO price price increase. They are already very expensive.
2. The Pro models should come with 128 GB for entry level, to justify that high Pro pricing.

But alas, my prediction is they won't raise the storage minimum until 2021, since people will pay those prices to get 5G.
Score: 18 Votes (Like | Disagree)
mag33 Avatar
57 months ago

1. It should have NO price price increase. They are already very expensive.

This. How can they justify asking more and more money every year? That's just criminal.
Score: 13 Votes (Like | Disagree)
MAFcz Avatar
57 months ago
Not major price increase.In Apple logic 100$ at least...
Score: 11 Votes (Like | Disagree)
tnsmart Avatar
57 months ago

The iPhone 4 design is still perhaps the best to date. Anyone else agree?
The iPhone 4 was my first iPhone and I loved the all-glass design. However, I thought that my 5s was the optimal size.
Score: 9 Votes (Like | Disagree)

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