IPad Air cheaper to make than iPad 3

Apple is notorious with its suppliers for screwing the last penny out of them.  That was demonstrated recently by the Bosch debacle with the iPhone 5s.

Now market research company IHS has revealed that it’s managed to cut costs on the iPad Air, meaning that its bill of materials (BOM) is less than the iPad 3, released last year.

IHS took an iPad Air apart to discover the cost of the components and discovered that the BOM for an iPad Air with 16GB is $304 – that’s six percent less than the $325 BOM for an iPad 3.

The cost for the low end iPad Air is $275, $42 less than the cheapest iPad 3.

According to analyst Andrew Rassweiler, this means that while iPads are getting slimmer, profits are getting fatter.

He said: “Although the Air’s new ultrathin display and touch screen are more expensive than for the third generation iPad, Apple has held the line on cost by taking advantage of price erosion in other areas.  Furthermore, the iPad Air leverages the same components and suppliers that are used in the iPhone 5S and 5c as much as possible.”

Presumably those suppliers don’t include Bosch.