iPhones And MacBooks May Become More Expensive Thanks To Rising Production Costs

iPhone and MacBook Pro production costs may soon become markedly higher. According to a report from a South Korean media site, TSMC recently told major partners that it will increase the prices of all chips manufactured with its 2nm and 3nm processes. Some partners, the report notes, will see price increases of upwards of 10%. If the rumor is true, it would impact several Apple products. The A19 processor used across Apple's iPhone 17 lineup, for example, is manufactured with TSMC's 3nm process.

What's more, Apple's M3, M4, and even the latest M5 chips with next-gen AI capabilities are also manufactured with a 3nm process. Specifically, Apple products with M-series processors include the MacBook Pro, MacBook Air, iMac, Mac mini, Mac Studio, iPad Air, and iPad Pro. While previous reports pointed to the iPhone 18 being more expensive due to the A20 chip, this is the first time we've seen reports of existing processors like the A18, M2, and M3 also seeing price hikes.

While Apple has traditionally secured favorable pricing from TSMC due to its high volume of orders, those days might be coming to an end. A recent report from China Times claims that because the capital expenditures necessary to produce chips with a 2nm manufacturing process are so high, TSMC is no longer offering volume discounts to any of its customers. Some estimates claim the A19 processor Apple introduced this year costs up to $90. If the rumored 50% price hike turns out to be true, that would bump up the cost of Apple's A20 Pro processor to $135. 3nm processors, meanwhile, might see a price increase of about $10. The price increase is certainly not a huge deal for Apple, given the company's growing cash reserves.

But the company famously does all it can to protect its margins. It will be interesting to see if Apple slightly raises the cost of iPhones and Macs across the board. It's also plausible that Apple might bear the cost itself to please potential customers. Notably, the iPhone's pricing has remained remarkably steady over the past six years. As a final point, it's worth noting that the chips developed with a 2nm process will feature a boost in processing power without any additional hit on battery life. The iPhone 18 Pro will reportedly be the first device to incorporate TSMC's 2nm chips when it ships with the A20 Pro processor next year.