NY Times: According to experts who analyzed the iPhone 4, the components that make up the latest Apple device cost about $187.51. Labor costs to assemble the phone only account for about 7 percent of its total price.
However, Chinese labor costs are rising--up 50 percent since 2005. In addition, a rising currency and inflation are also increasing costs at Chinese electronics factories. In response, the factories are considering re-locating to less expensive parts of China.
Electronics companies are trying to figure out how to deal with the higher costs, says technology analyst Jenny Lai. Theyre already squeezed, so squeezing more costs out of the system wont be easy.