GoKawiilRobert Triggs / Android Authority
TL;DR Smartphone RAM and storage costs have nearly quadrupled over the past year, with a 12GB + 512GB configuration now costing manufacturers approximately $218 more, according to a top Xiaomi executive.
While brands have used existing inventory to maintain lower prices, those supplies are running out, leading to predicted flagship price hikes of $100-$200.
RAM prices have kept climbing for much of this year, shocking the supply chain and forcing brands across product categories to pass on the rising costs to consumers or even outright kill some products. While it’s easy to see the skyrocketing prices of components in PCs, it’s much harder for consumers to notice the price increases on phones. If you’ve been wondering just how bad RAMageddon will pinch you on your next phone purchase, we finally have some credible numbers to relate to.
Xiaomi Group President Mr. Lu Weibing took to Weibo to inform consumers about the recent memory price increase.
According to Mr. Weibing, prices for the same RAM and storage configuration have risen nearly 4x in a year. For instance, the popular 12GB RAM and 512GB storage configuration seen on flagships has increased in price by CNY 1,500 (~$218), while the even higher-end 16GB RAM and 1TB storage version has seen an “even more outrageous” increase.
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The context for Mr. Weibing’s statement is to rationalize the price increase that Xiaomi’s Redmi sub-brand has to undertake in its home market, China. Still, the general economics of the increase apply to all manufacturers selling in all regions of the world. You can easily envisage a $100-$200 price increase for Android flagships sporting that RAM and memory configuration, and even those numbers are on the conservative side.
So why haven’t all Android brands raised their prices yet? The answer is the inventory in hand. Manufacturing and assembly contracts for phone components are finalized and signed months and years in advance of a phone reaching a consumer’s hands. As a result, there’s a natural lag in price fluctuations as phone makers churn through their existing inventory before they are forced to pass on the increased prices on newer stock to consumers.
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