Apple may be looking to offset 5G costs in iPhone 12 with simpler battery

21 Aug 2020292 Views

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With expectations that 5G connectivity could make the iPhone 12 much more expensive to make, Apple may look to the battery to save costs.

An industry analyst familiar with Apple’s manufacturing processes has reported that the company is looking to make significant changes in the iPhone 12 to allow for 5G connectivity. According to MacRumours, Ming-Chi Kuo said that the adoption of Sub-6GHz 5G technology will increase the manufacturing cost by between $75 and $85 per phone and millimetre wave technology will incur a cost of between $125 and $135.

This cost increase means Apple could be looking to find ways to make its other components cheaper, in this case, a simpler and smaller battery design with fewer layers. According to Kuo, a hybrid battery board containing soft and hard parts will potentially be up to half the price of the battery found in the iPhone 11, despite its relatively small contribution to the overall cost.

Diversified manufacturing

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In its phones beyond the iPhone 12, Kuo believes Apple may look to a purely soft battery board that could cut up to an additional 40pc off costs. The move is expected to put increasing pricing pressure on Apple’s circuit board suppliers, with the average cost of the soft and hard boards of the AirPods 2 headphones decreasing by up to 35pc in the first half of 2020.

Apple’s entire production line is currently undergoing significant change, most notably its attempts to diversify suppliers and manufacturers outside of China. In July, reports emerged that production of the iPhone 11 began at Foxconn’s plant in Chennai, India. This was the first time a top-end Apple phone had been made in India.

While Apple did not officially comment on the news, it is understood that the company is also considering producing its newer, smaller iPhone SE at a plant in Bengaluru. The Economic Times had previously reported that Apple plans to expand manufacturing overall in India, with one of its contract manufacturers, Pegatron, recently registering a subsidiary in the country.

Colm Gorey is a senior journalist with Siliconrepublic.com

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