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Apple is putting pressure on Samsung, and it could lead to cheaper iPhones this year

Jacob Siegal

Apple’s attempt to diversify its OLED panel supply chain appears to be a non-starter after a report last week revealed that LG fell behind schedule after running into manufacturing issues. As a result, Apple will probably have to stick with Samsung as its sole supplier, but industry sources claim that Apple wants a discount from Samsung as it doubles its order of OLED panels from around 50 million in 2017 to nearly 100 million in 2018.

According to DigiTimes, Apple needs 25 million OLED displays for the remaining iPhone X models it plans to produce this year and 75 million addition displays for the next-generation iPhone models coming this fall. Rumors have pointed to a 5.8-inch model as well as a 6.5-inch iPhone X Plus, both of which will feature OLED displays.

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Due to the size of the order, Apple is reportedly putting pressure on Samsung to cut the unit price of each OLED panel to $100 from the $110 that the supplier charged in 2017. As DigiTimes notes, the OLED panel accounts for nearly one-third of the total production cost of the iPhone X, and is one of the primary reasons that the phone costs as much as it does. If Apple can save money on this key component, it could potentially pass those savings along to consumers.

Of course, Samsung could just say no, especially knowing that Apple doesn’t have anywhere else to turn at the moment, but sources tell DigiTimes that OLED panel makers in China are poised to lower prices in order to keep their production lines up and running. When that happens, Apple will be free to jump ship, so it might be in Samsung’s best interest to cut a deal with Apple in order to remain the primary supplier of OLED panels.

Whether or not this will have any effect on the retail price of the next-gen iPhone remains to be seen, but as the price of OLED panels begins to drop, Apple will have a much harder time justifying a four-digit price tag. Recent rumors have suggested that Apple’s 5.8-inch iPhone X successor might start at $899 instead of $999.

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