When it comes to smartphones, Apple’s iPhone line is considered to be one of the most expensive devices in the market today starting at $800 to as much as $999 per smartphone. 

This year’s iPhone 11 is expected to be priced the same as last year’s iPhone despite some negative feedbacks based on recent leaks and information from reliable Apple insiders. However, a surprising information has revealed that the Cupertino giant might actually be giving the latest iPhone a much cheaper price tag. 

According to Forbes, a report from JP Morgan has revealed that Apple was able to significantly cut down on the cost of building the iPhone 11. In comparison, the new phones’ production cost is said to be 12 percent cheaper than the iPhone XS production. 

The initial report, which was released by AppleInsider, showed that the bill of materials for this year’s iPhone was reduced by around $30 and $50. The lower cost is due to a reduction in memory prices brought about by Apple abandoning the 3D Touch for the new iOS device. 

But could this mean cheaper iPhones this year? Well not exactly. According to the Forbes report, the production savings will most likely be used to “absorb the threat of 10 percent tariffs being placed on Chinese electronics (the vast majority of iPhones are made in China) in the ongoing trade war between China and the United States.” 

If this is true, then Apple’s earnings would be impacted by as much as eight percent if the company uses the production savings to absorb the tariffs. The scenario, however, directly impacts sales in the U.S. and not sales happening in other parts of the world. According to JP Morgan, there won’t be any price cuts planned for other regions, so “Apple will still overall benefit from the reduced production cost.” 

This well-played scenario that greatly benefits Apple shows that the problem the Cupertino group is facing is how to convince people to buy a new iPhone that’s considered to be ugly and boring, especially when compared to next year’s excellent lineup.

The iPhone 11 has been hounded for months for choosing to use an ugly triple-camera system at the back of the iPhone. Although arguably powerful, the glaring change at the back seems a bit too much for many Apple fans and analysts.