iPhone 6 Plus costs $16 more to make than iPhone 6, but costs $100 more

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Apple By James Plafke Sep. 24, 2014 4:11 pm
We all know that prices of retail products tend to be marked up far beyond what they actually cost a company to produce. Shoes and sunglasses are the usual culprits, with Ray-Bans often being quoted as costing just $3 to produce, yet*being sold for $150. Tech also experiences*from a vast markup, and the new iPhone 6 and iPhone 6 Plus suffers from the same fate. The markup gulf is even more apparent when comparing the two models, with the iPhone 6 Plus only costing $15.50 more to produce than the iPhone 6, but being sold for $100 more.
According to a new report, the 16GB iPhone 6 costs roughly $200.10 to produce, and $215.60 for the iPhone 6 Plus. The most obvious difference between the models, the screens, have a $7.50 difference. The 4.7-inch iPhone 6 display costs*$45, while the 5.5-inch 6 Plus display costs $52.50. With a carrier subsidy, the 6 and 6 Plus start at $199 and $299, respectively; without subsidy, they price starting at $649 and $749. The $199 price (arguments about carrier subsidy aside) is pretty fair considering it costs a buck more to produce that phone. The iPhone 6 Plus, though, marks up for about $83.
To be fair, the quoted production costs only cover hardware components and manufacturing, and don’t account for a number of other factors, such as licensing, software, and research and development.
The more memory a model has, the more the markup grows — this has always been the case. However, now that Apple is offering another desirable*feature on top of the memory — the larger size of the 6 Plus — the company can raise the markup cost. This means that Apple would rather sell you the iPhone 6 Plus than the standard 6, as there’s more money to be made on your purchase.
Now read:*iPhone 6s are being bent in people’s pockets (including mine)



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