OLEDs: Can Apple reduce iPhone costs through renegotiation?
Apple has little leverage against soaring DRAM and flash prices. Now, pressure is being put on other component manufacturers, it is said.
iPhone display: There’s still room for negotiation.
(Image: lilgrapher / Shutterstock)
According to market analyses, the components needed for the iPhone 18 Pro could be up to 38 percent pricier. The main reason is the RAM inflation and the simultaneous increase in flash memory prices. Now Apple is trying to make savings elsewhere, in addition to improved (and above all, larger) inventory management. According to reports from South Korea, Apple is putting pressure on its OLED producers, among others, to lower their tariffs. LG Display and Samsung Display are affected. It is also conceivable that Apple will rely more heavily on the local supplier BoE again, at least for hardware in China.
Apple has negotiating power in the OLED business
Apple is reportedly planning to reduce display costs even for the previously top iPhone, the Pro Max model. This is by no means about small adjustments. Instead, for the upcoming iPhone 18 Pro Max, Apple would like to pay only 68 instead of up to 120 US dollars per OLED panel. Negotiations have reportedly been ongoing for several weeks.
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While there are other large buyers in the AI sector for RAM, flash, and NAND, putting Apple in an unusually difficult negotiating position, this is not the case for smartphone panels. The entire industry, with the exception of Apple and partly Samsung, is suffering from declining sales. Furthermore, there is little competition in the high-end segment required by Apple, especially for the requested quantities. According to industry insiders, the price pressure on semiconductors is also causing component sales for smartphones to decline overall, further worsening the position of display corporations.
Samsung Display and LG Display need more orders
According to South Korean reports, Apple has also succeeded for the first time in reducing OLED costs at Samsung Display and LG Display to the same level. Previously, LG Display had charged more. The manufacturing process is becoming more complex: for the iPhone 18 Pro and 18 Pro Max, observers expect the use of an improved LTPO technology (“LTPO+”) with lower power consumption and better contrast.
Samsung Display and LG Display also depend on the customer Apple in another area. They also produce OLED panels for the iPad Pro and presumably also the new MacBook Ultra with touchscreen. Samsung Display is again likely to be the sole supplier for the panels in the first Apple foldable. It could cost well over 2000 euros. At least, especially thanks to Apple, the South Koreans are currently enjoying good business. The reasons are said to be both good iPhone sales and preparations for the next quarter, as Apple is already filling its warehouses (or those of its end assemblers), as mentioned.
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