Recently, Nikkei Shimbun cooperated with Tokyo research firm Fomalhaut Techno Solutions to dismantle the three models of the iPhone 14 series launched by Apple in September. Models on sale rose by about 20%, setting a new record. In terms of countries/regions, the proportion of US-made parts has made a major leap forward, surpassing the Korean factory, and the proportion of mainland China and Taiwan has shrunk.
According to Fomalhaut, the cost of parts for the iPhone 14 Pro Max has surged by more than $60 to $501 compared with the iPhone 13 Pro Max, which was launched last year. Since Apple’s highest-end “Max” model came out in 2018, the cost of parts has remained between US$400-450, but this time it has soared by more than US$60. The total cost of parts and the increase are the highest since 2018. Rising manufacturing costs mean Apple’s profit margins could slip.
The report pointed out that the main reason for the surge in BoM costs is chip prices. In the iPhone 14 series, the Pro and Pro Max are equipped with Apple’s own A16 Bionic chip, which costs as much as $110 and is 2.4 times the A15 chip on last year’s iPhone 13 Pro Max. The high price is due to the availability of rare goods, TSMC and Samsung Electronics are currently the only two companies that can produce 4nm chips.
The performance of the camera components has also improved, with the main camera CMOS sensor made by Sony Group, the largest of the three rear cameras, 30% larger in size and about 50% more expensive to $15.
Sony’s sensor has a unique layered structure that ensures the area of each pixel through a smaller sensor size, ensures brightness and suppresses noise, you can take high-quality photos.
For the display, the iPhone 14 continues to use OLED and sourced from rival Samsung Electronics.
Qualcomm remains the main supplier of mobile communications chips on the iPhone 14. In recent years, every time Apple releases a new iPhone, people will pay attention to whether its 5G chip is self-developed.
Around 2017, an intellectual property dispute broke out between Apple and Qualcomm. Although the two parties reached a settlement in 2019, Apple acquired the smartphone baseband business from Intel in the same year. Therefore, the industry believes that Apple will continue to realize self-developed communication chips through acquisitions. In addition, in 2018, Apple also acquired part of the power management chip business from the then British company Dialog, and realized the self-research of some power management chips.
The country’s share of the cost of major components was affected by higher prices for expensive semiconductors, reaching 32 percent in the U.S., about 10 percentage points higher than last year’s model. Last year’s leader, South Korea, fell 5 percentage points to 25 percent.
As far as the country/region situation is concerned, affected by the rise in semiconductor prices, the share of Apple’s own parts in the overall parts cost of the iPhone 14 Pro Max has continued to increase, resulting in an increase in the proportion of American parts, accounting for as high as 32.4%, Compared with last year’s iPhone 13 Pro Max (22.6%), it jumped to the top by nearly 10 percentage points; South Korea, which ranked first last year, shrank from 30.4% to 24.8%, Japan from 14.5% to 10.9%, and Taiwan from 8.4% It shrank to 7.2%, and mainland China also fell from 4.5% to 3.8%.
Apple’s latest supply chain list: the mainland factory has 7 in and 6 out, and the Taiwan factory has 3 in and 7 out
Although Chinese companies have declined in the proportion of suppliers for the iPhone 14 series, according to the latest Apple 2021 fiscal year supply list, mainland suppliers are seven in and six out, and the lineup remains stable.
According to Juheng.com, the new mainland suppliers include Zhongke Sanhuan, Crystal Optoelectronics, Shenzhen Qiande Electronics, Wingtech Technology, Jiangyin Kangrui Forming Technology and Baotou Yingsite Rare Magnetic New Materials, while OFILM is was removed.
In terms of Taiwanese factories, three were included and seven were excluded this year. It is worth noting that Taiwanese factories Shuanghong, Kangkong, and Liangwei were only included in the supply chain last year, but this year Apple announced that they were not on the list and have been removed from the supply chain list. The Taiwanese factories that joined this year include Taiyao Technology, SMT supplier Taiwan Tablet Technology, and keyboard MTS (membrane touch switch) major manufacturer Kejia-KY, while those removed are Shuanghong, Liangwei, Kangkong, Zhizhi Shenke, Ruiyi, Jinjian Printing and Pioneer Materials.
Four Japanese suppliers came in and five came out, with Japanese light metals, energy groups ENEOS, MegaChips and Toyoda Gosei joining the supply chain.
Korean IC design LX Semicon also became a new member of Apple’s supply chain this year. In the US, Power Integrations and Lattice Semiconductor joined the supply chain, while Maxim and Trinseo were excluded.
Apple has hundreds of major suppliers around the world, and in order to maintain stability, every year, a group of partners is purposefully eliminated, even if these manufacturers have made no mistakes. In the cooperation with Apple, the two sides are not a “win-win” equal relationship, but closer to a master-servant relationship model. Apple has the absolute right to speak, and even top partners Samsung and Foxconn cannot bargain with Apple.
In 2016, Apple asked suppliers to reduce their quotations by 20%, which was opposed by Foxconn, saying that such a price was unacceptable, and Apple would not accept orders without reasonable profits. In the face of Foxconn’s tough response, Apple immediately distributed iPhone and AirPods orders to Pegatron, Luxshare, Wistron and other major foundries, and continued to support the growth of other foundries to weaken Foxconn’s influence . In the end, Foxconn, which was cut off orders and continued to weaken its bargaining power, could only honestly listen to Apple’s demands.
In order to break Samsung’s monopoly on screens, Apple has also cooperated with LG, BOE and other manufacturers. Even if the total sum of the latter two is only a fraction of Samsung’s, it can also curb Samsung’s right to speak to a certain extent.
It should be noted that Apple has announced the top 200 major suppliers in the past. However, since the 2020 fiscal year, Apple’s announced supply chain list will only include 98% of raw material, manufacturing and assembly suppliers. The latest list is 2021 accounting Annual, i.e. the fourth quarter of 2020 to the third quarter of 2021.
Some analysts say that in recent years, Apple has been emphasizing metal recycling and reuse, and the increase in Chinese suppliers this time reflects this. It is related to magnetic materials, and the main business of Kangrui Forming Technology is stainless steel, new metal materials and forming technology. It can be seen that Apple is strengthening the development of rare metals, magnetic materials and metal recycling.
The content of this article refers to reports from Nikkei Shimbun, Fomalhaut Techno Solutions, Juheng.com, Apple’s official website, and IT House.
Editor in charge: Luffy