iPad mini 2 Likely to Cost $12/€9 More to Manufacture

Apple this year is poised to introduce a second-generation iPad mini with a Retina display boasting a resolution of 2048 by 1536 pixels, which will increase the production cost by more than US$12 (€8.9) per tablet, iSuppli reports.

DigiTimes cites the market research firm as saying that the iPad mini 2 will have a bill of materials (BOM) above the $200 / €150 mark, if the prices and specifications of all other components making up the tablet remain in place.

While the iPad mini 2 hasn’t even been confirmed, the consensus among analysts is that Apple will, at some point, upgrade the resolution from 1024 x 768 to 2048 x 1536, which is exactly the screen resolution of the fourth-generation iPad with Retina display.

iSuppli explains that it’s not only the increased number of pixels that will raise the BOM, but also the increased number of LEDs required to achieve proper backlighting.

As such, “market observers believe the total cost for iPad mini will increase by more than 30% if it is equipped with the 7.9-inch Retina panel,” according to the report.

It is worth noting that the iPad mini already has lower profit margins than most other Apple products.

However, Apple is selling these things by the millions, and is likely generating profits in other areas of the company thanks to a wide install base of its iOS operating system.

It has been reported that the iPad mini is beginning to eat away at the market share of its own siblings, the full-size (9.7-inch) iPads.

At least this past holiday season, the iPad mini became a runaway hit as a Christmas present.

An iPad mini 2 with a Retina display, a faster processor and (perhaps) more color options will undoubtedly create another splash this year. Analysts estimate that Apple is planning to roll out the goods in fall.