iPhone build costs, workers get $1.78 an hour

As I’m sure most know, the FLA is inspecting Apple supplier Foxconn over labor concerns and recently Nightline was given access to a Foxconn factory where we learn a few things such as how much a worker gets per hour, $1.78, and the look inside Foxconn has apparently led to insights into just how much it costs to make an iPhone.

According to the guys over at Cnet, former Nokia business development manager, analyst and blogger, Horace Dediu has tried to break down what has been learn by taking two clues from the Nightline report, one that it takes 24-hours to build an iPhone, which includes 6 to 8-hours of “ software and component ‘burn-in’ and testing, and that a worker gets just $1.78 per hour.

Dediu then run the figures through some calculations and has come up with a cost range for the labor to make an iOS smartphone and that the cost is likely to be somewhere between $12.50 and $30 per iPhone.

Apparently iPhone labor costs are small somewhere between 2% and 5% of the sale price, and that the 141 steps of human interaction could be automated, but as it isn’t automated it implies that the cost of automation would be higher, and flexibility of the auto-process would be lower.

Dediu does say though that due to the design intensity and quality testing these manufacturing costs are likely to be much higher than rival devices and could be as high as 300%.

The guys say though that basically when a customer forks out hundreds of buck for their iPhone, the chances are more dollars are going towards the warranty than to the workers that build the iOS smartphone.

Of course whatever the iPhone actually costs won’t make any difference to those who purchase the device, as I am sure when Apple delivers the iPhone 5 the iOS faithful will still be queuing up in droves to get hold of it.

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