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Apple's entry-level iPad Air 2 costs $275 to build, retails for $499

By Shawn Knight
Oct 29, 2014
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  1. Apple's second generation iPad Air costs exactly $1 more to build than its predecessor, a teardown of the new tablet revealed. Even still, the company's profit margins at the top end aren't quite as nice as they were a year...

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  2. Rippleman

    Rippleman TS Guru Posts: 559   +171

    Interesting, but most (especially biased apple haters) will only see it as profit grab. Material alone is not a end factor of how much something "costs". Example: A windows 8 dvd costs about 8 cents to build and costs $119.99.

    There is boxing, packaging, shipping, retailing, warranty, insurance, employees, equipment costs, equipment maintenance, rent cost, lease costs, fuel costs, replacement costs, taxes, employee benefits, research, development, and on and on and on.
     
    mctommy likes this.
  3. Hexic

    Hexic TS Addict Posts: 283   +132

    Very true - the material cost alone isn't something to solely base off of. BoM and labor are the two that matter.

    Although, even accounting for labor, with as much profit they have made (while shelling out the labor expenses) is still very high. I refuse to pay ridiculous premiums for mediocre hardware and software. :3
     
  4. mctommy

    mctommy TS Booster Posts: 190   +30

    People would be amazed as to how much cost goes into supply chain management for a lot of products out there.
     
  5. cmbjive

    cmbjive TS Booster Posts: 777   +137

    As an "Apple hater" I don't see it as a profit grab. There are obviously other things that going into building an iPad and only giving people the "bill of materials" is a half-hearted attempt at pushing the meme that Apple is somehow gouging its customers for its products. If those consumers don't like the price don't pay it. At the time when people stop overvaluing Apple Apple will stop overvaluing its products.
     
    Skidmarksdeluxe likes this.
  6. Uncle Al

    Uncle Al TS Evangelist Posts: 1,660   +767

    As an Apple stock holder I love to see the profits, but as one that has watched this market ever since the first consumer PC rolled out I have seen quite a bit of over priced devices out there. Gone are the days when a 10-20% profit margin was considered excellent. I have missed seeing the old studies that showed how many more sales could be generated through lower prices on consumer electronics. Of course, it's our own fault for leaping at every new thing that comes out. Long live the spontaneous buyer!
     
    cmbjive, Skidmarksdeluxe and Hexic like this.
  7. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 6,475   +2,033

    I never knew Win 8 DVD's were built, I thought they were pressed, it just goes to show you learn something new everyday :D
    It's not quite the same thing, you're not paying $120 for the physical copy of the DVD, you're paying a $120 license fee to use the software, whether you buy a physical copy or download it the price is the same.
    Apple are overcharging for the tablet but it's understandable otherwise it just wouldn't be Apple.
    Life is full of choices, if you don't like the price don't buy it, if you happy with it then go ahead by all means, you're free to make the choice (Choice is the only free thing you'll get from Apple anyway).

    I agree.

    Good news for stock holders, bad news for consumers but that's the way it goes.
     
  8. SNGX1275

    SNGX1275 TS Forces Special Posts: 10,704   +397

    Doesn't the iPad come with iOS? (OS X updates have been free for a few years now)
     
  9. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 6,475   +2,033

    Yup. I've got to give them kudos for that. Honestly speaking I really do like some of their products, it's their corporate bs and aloofness that drives me away.
     
    SNGX1275 and Arris like this.

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