Apple is expected to launch 5G enabled iPhones next year. The rumor mills have been predicting a price increase for 2020 iPhones. Apparently the increase in price is attributed to 5G modem. Famed Apple analyst Kuo says that Apple will not significantly increase the price for 2020 iPhones. In other words, the 2020 iPhones will be priced similar to the current iPhones with only a marginal increase in price.
Kuo further claims that Apple is expected to offset the increase due to 5G by reducing its supply chain expenses. The Cupertino company is mulling decreasing non-recurring engineering costs. The NRE cost is the money spent on research and development of a new feature, technology or component. Apple is likely to shift the research and development in house to bring down the costs.
Apple suppliers are likely to be hit if the company decides to cut down on non-recurring engineering charges. Typically, the companies rely on non-recurring engineering payments during the slow iPhone sales season. However, Apple is expected to release the device biannually. The iPhone SE2 is expected to be launched in the first half of the year while the other premium iPhones will be launched in the second half. Hopefully, the new release cycle should soften the blow of a decrease in non-engineering expenses.
Earlier reports had hinted that 2020 iPhones will arrive with a redesigned metal frame and sport flatter edges. Even in today’s note, Kuo mentioned that the new chassis and frame on the 2020 iPhone will cost Apple significantly more. Furthermore, it is also learned that Apple will launch five new iPhones in 2020 and the list will include 4.7-inch, 5.4-inch, Two 6.1-inch, 6.7-inch models.