Apple recently launched the iPhone 16 series in India at a starting price of Rs 79,900. The launch price is similar to its predecessors, the iPhone 15 or even the iPhone 12. While the move appears to be benefiting buyers, analysts say that although the launch price of the iPhone remains unchanged, the actual cost of producing the iPhone 16 is significantly higher than the iPhone 15.

According to a recent report from TD Cowen, the manufacturing cost of the iPhone 16 series has increased due to the increase in component prices and the more advanced technology Apple has incorporated into it. The report says that the more advanced features of the iPhone 16, especially in the Pro and Pro Max models, are partly responsible for the increased production costs. TD Cowen’s analysis shows that the bill of materials (BOM) for the iPhone 16 Pro Max is around $485 (roughly Rs. 40,739), while that for the iPhone 15 Pro Max is $453 (roughly Rs. 38,051), a difference of $32. Similarly, the iPhone 16 base model cost $416 to manufacture, which is $21 more than the iPhone 15, which had a BOM of $395.

Analysts say these increases are primarily due to specific components that have become more expensive in the iPhone 16 lineup. For example, the most expensive parts of the iPhone 16 Pro Max are tied between its display and rear camera module, each costing about $80. The rear camera module in particular saw a significant jump in cost, increasing by $15 compared to the iPhone 10 generation.

Additionally, memory and storage upgrades in the iPhone 16 series have contributed to the overall expenditure. The cost of memory in the iPhone 16 Pro Max has increased from $9 for 6GB in the iPhone 15 Pro Max to $17 for 8GB in the new model. Similarly, storage components increased by $5, bringing their cost to $22.

The increase in production costs is also attributed to the new features brought by the iPhone 16 series. The iPhone 16 Pro models are equipped with Apple’s new A18 chip, which costs about $45 to make, while the A16 chip used in the iPhone 15 series costs $35. The cost increases further with the addition of advanced features such as camera controls and action buttons, adding an estimated $3 to the sensor module.

However, despite the increase in costs, Apple has kept the launch price the same while absorbing the expenses to maintain pricing stability in the competitive smartphone market. This is why consumers do not see any direct impact on the sticker price. However, the report suggests that while prices are stable for now, rising production expenses could eventually lead to higher prices for future models, or Apple may seek other cost-cutting measures in the future.