14 DAY TRIAL // A thorough teardown analysis of the latest iPad has revealed to research firm IHS that Apple actually pays $42 (€31) less to make the iPad Air, compared to the third generation iPad from early 2012.
All Things D has it on file from IHS that “...even with a more expensive display, the total component cost of the base model, at $274, is still $42 cheaper than the entry-level third-generation iPad.”
That’s a massive leg up for Apple, which sells the iPad Air (its fifth-generation tablet computer) at the same price as it sold the iPad 3 in 2012. The tablet costs far less to produce but still sells for the same price. Talk about profit margins!
The main reason behind Apple’s ability to drastically reduce production costs is the fact that the components making up the iPad haven’t changed much in recent years. The major new things are the design (which actually uses up less material) and the processor.