Teardown analysis of iPad air

IHS has revealed the tear down analysis of iPad air, where it finds the cost of bill of materials in this new model is less than the old iPad model. The thinner 64-bit computing powered iPad air is already a hit in the market. Below is the teardown analysis data of iPad air shared by IHS in its release: The iPad Air with 16 gigabytes (GB) of NAND flash memory and cellular connectivity has a BOM of $304, according to preliminary results from the Teardown Analysis Service at IHS Inc. (NYSE: IHS). This represents a 6 percent reduction from $325 for an equivalently equipped third-generation iPad, based on a final pricing estimate for the device at the time of the release in 2012. When the $6 manufacturing cost of the iPad Air is added in, the total cost to make the tablet increases to $310. For the lowest-end iPad Air model with 16GB of NAND and no cellular connection, the BOM and manufacturing cost is $274, $42 less than the entry-level third-generation iPad. “While the iPad Air slims down in size, the profit margins are getting fatter,” said Andrew Rassweiler, senior director, cost benchmarking services for IHS. “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 component...