According to a well-known Chinese analyst, Pan Jiutang, the Xiaomi Mi 11 and iPhone 12 cost the same to make, and yet the Mi 11 is much cheaper. Before we get to the details, do note that Mr. Jiutang is also Xiaomi’s collaborator.
The Xiaomi Mi 11 base variant with 8GB of RAM and 128GB of storage is priced at CNY3,999 ($619) in China. The iPhone 12’s 128GB storage variant is priced at CNY6,799 ($1,052) in China.
The Xiaomi Mi 11 & iPhone 12 cost the same to make, while the Mi 11 is much cheaper
That makes the iPhone 12 CNY2,800 ($433) more expensive in China. That’s a huge difference in general, and especially if you consider that the two phones cost the same to make. It is worth noting that the Xiaomi Mi 11’s global price tags haven’t been announced yet.
Now, Mr. Jiutang did not mention how much each phone costs to make, but an earlier report did reveal that information for the iPhone 12. Based on that information, the iPhone 12’s bill of materials (BoM) is $373.
This sum doesn’t account for expenses such as research and development, salaries, and marketing, so keep that in mind. This is only the cost of making the phone itself.
Xiaomi pledged to keep its profit margins low
So, why is there such a difference in price tags for the two phones? Well, Xiaomi always did its best to keep its profit margins low, it even pledged to do so. Apple, on the other hand, is the complete opposite of that.
Apple is an extremely well-known brand, and many people would say a premium brand in a sense. They never really cared about how much other products cost, as their products have never been cheap, in any way.
It will be interesting to see how much will the Xiaomi Mi 11 cost globally. The device’s global availability should be announced soon, and its global price tag will be higher than the one in China, that’s for sure.
The Xiaomi Mi 11 probably won’t cost much more outside of China, though. The Mi 11 was announced on December 28, with a really powerful spec sheet. A spec sheet that includes a QHD+ 120Hz AMOLED display, the Snapdragon 888 SoC, LPDDR5 RAM, 55W wired and 50W wireless charging, and much more.