Apple Inc.'s AAPL +1.33% cost to produce the 32-gigabyte, 4G long-term evolution version of its new third-generation iPad is $375.10, nearly 9% higher than the iPad 2 with 32GB and 3G wireless, according to IHS iSuppli's tear-down analysis of the new tablet.
Though the new iPad is more expensive to produce than the iPad 2, the retail price points are the same. The market-research firm said the $364.35 estimated bill of materials, which excludes $10.75 for manufacturing costs, represents 50% of the $729 retail price for the 32-gigabyte LTE version. The firm estimated the bill of materials for the 16 gigabytes, 4G LTE version at $347.55, and said the 64-gigabyte version was about $397.95. The lowest-end version of the new iPad, with 16 gigabytes of memory and no LTE, carries a combined bill of materials and manufacturing cost of $316.
Meanwhile, the highest-end model, with 64 gigabytes and integrated LTE, has a total bill of materials and manufacturing expense of $408.70. Sales of the new iPad began Friday at a starting price of $499 for the Wi-Fi only models, and $629 for those that have cellular connectivity. The 4G wireless speeds are as much as 10 times faster than 3G found in the iPad 2