Teardown Reveals Moto X Only Costs $221 to Build

Discussion in 'Android News' started by dgstorm, Aug 28, 2013.

  1. dgstorm

    dgstorm Editor in Chief
    Staff Member Premium Member

    Joined:
    Dec 30, 2010
    Messages:
    11,016
    Likes Received:
    3,979
    Trophy Points:
    823
    Location:
    Austin, TX
    Ratings:
    +4,254
    [​IMG]

    Previously we shared the iFIxit teardown of the new Moto X smartphone, but that only focused on the repairability of the device. A new teardown from the folks at IHS focused on the BOM (Bill of Materials), which is basically how much the parts cost to manufacturer the device (not including marketing). By IHS' calculations, the BOM for the Moto X is precisely $221 USD. As a reminder for comparison purposes, the Moto X costs $199.99 on-contract and $579 off-contract for the 16GB version. The 32GB model costs $249.99 on contract or $629.99 without a contract.

    What's surprising about this is that the manufacturing cost side of the device is about $4-$5 bucks higher than what it costs to manufacture flagship smartphones in Asian countries. It's also interesting to note that this price is about in the middle of the pack when compared to the BOM of other flagship smartphones. For example, the SGS4 costs $236 and the iPhone 5 is $207. Share your thoughts in this "insider info."

    Source: AllThingsD via MotoXForums
     
  2. guidot

    guidot Developer Relations
    Staff Member Premium Member

    Joined:
    Feb 10, 2010
    Messages:
    7,346
    Likes Received:
    274
    Trophy Points:
    198
    Location:
    Massachusetts
    Ratings:
    +274
    Waiting for all of the "why isn't the off contract price $250" posts. Ugh.

    If that's just parts, then how much to build? What is the labor? $5 extra is labor?

    Sent from my SCH-I605 using Tapatalk 2
     
  3. pc747

    pc747 Administrator
    Staff Member Rescue Squad

    Joined:
    Dec 23, 2009
    Messages:
    24,243
    Likes Received:
    5,276
    Trophy Points:
    1,123
    Ratings:
    +5,860
    Yeah if it was built in China.
    Many of us,including me, couldn't see spending top dollar for dual core. But that mx8 proved a lot of us wrong and I am still eating crow for that.

    Sent from my SAMSUNG-SGH-I317 using Tapatalk 2
     
  4. djspy

    djspy Member

    Joined:
    Aug 19, 2010
    Messages:
    643
    Likes Received:
    14
    Trophy Points:
    18
    Location:
    N. California
    Ratings:
    +14
    That's just parts? What about if we factor in labor costs and other expenses Google/Motorola have to make like paying for the building, utilities, Insurance, equipment etc etc? It comes out to a much higher number.
     
  5. civiksi

    civiksi New Member

    Joined:
    Jan 4, 2012
    Messages:
    24
    Likes Received:
    4
    Trophy Points:
    3
    Ratings:
    +4
    Don't forget R&D. That's not free either.
     
  6. kodiak799

    kodiak799 Gold Member

    Joined:
    Feb 20, 2010
    Messages:
    5,979
    Likes Received:
    767
    Trophy Points:
    258
    Ratings:
    +933
    Yeah, that teardown just proves that this was never going to be a $300 device off contract. Even "cheap" phones probably have $150 or more in parts, plus labor. The Nexus device only sell for $300 or so because Google subsidizes them
     
  7. alafferty82081

    Joined:
    May 29, 2013
    Messages:
    147
    Likes Received:
    6
    Trophy Points:
    18
    Location:
    west jefferson n.c
    Ratings:
    +6
    The cost of labor is much higher in america, no slave labor here........
     
  8. NOVICE

    NOVICE Active Member

    Joined:
    Feb 12, 2012
    Messages:
    246
    Likes Received:
    32
    Trophy Points:
    28
    Ratings:
    +32
    If this article is correct regarding the various BOM's, then I was hughly mistaken in assuming that Motorola was using the novelty of the Moto X to sell, at a premium price, a device which cost the company a lot less to get out the door than an S3 or Note 2 cost Samsung.

    I was critical of the unsubsidized price of the Moto X and apparently should not have been.
     
  9. TatDroid

    TatDroid Active Member

    Joined:
    Nov 27, 2009
    Messages:
    889
    Likes Received:
    184
    Trophy Points:
    43
    Ratings:
    +199
    I was actually surprised at how LITTLE the difference in manufacturing costs was. According to iFixit the cost to assemble in the US is $12/unit, vs $7 to $8/unit in Asia.
     
  10. kodiak799

    kodiak799 Gold Member

    Joined:
    Feb 20, 2010
    Messages:
    5,979
    Likes Received:
    767
    Trophy Points:
    258
    Ratings:
    +933
    You ever see factories in China/Mexico? They have like 3 people doing the jobs and controlling quality of 1 American, partly why the cost advantage isn't close to what it used to be even though there's still a relatively huge gap in wages.

    And the other side of that is US factories typically employ a lot more automation. $5 is not a big gap (@ 1% margin), but if we were talking PCs where there's almost no margin, for example, that $5 gap would be pretty significant.

    Anyway, a decent part of that $5 labor gap might be the pseudo customization. Changing the backplate and a few color isn't much right now, but if they can offer full ala carte for $15-$20 more you might have a real winner.