Apple reportedly will produce twice as many MacBook Neos as it originally planned. That will require producing more A18 Pro chips, which might force Apple to raise the price of the popular laptops.
Demand for the company’s first entry-level notebook exceeds supply because it also exceeds Apple’s prelaunch estimate of how popular the MacBook Neo would be.
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MacBook Neo demand just won’t slow down
The MacBook Neo marks the company’s most aggressive push into the budget laptop market. It comes with a 13-inch Liquid Retina display, a durable aluminum design, and all-day battery life, all at a starting price of just $599 — the lowest ever for an Apple laptop.
The combination proved extremely popular. Even now, months after the product launch, wait times for orders placed on the Apple Store stretch out for weeks.
“The customer response to MacBook Neo had just been off the charts, with higher-than-expected demand.” Apple CEO Tim Cook said during a recent conference call with investors,
But the Mac maker won’t let itself run out of inventory.
“Apple has doubled its MacBook Neo production plans after the laptop’s runaway success,” said analyst Tim Culpan on his Culpium blog. “It’s now asking suppliers to prepare capacity for 10 million units of the debut version of the Neo, up from an initial estimate of 5 million to 6 million.”
A possible Neo price hike
Apple’s move to double production might seem obvious, but it’s actually quite a complicated problem. The A18 Pro chip that powers the laptop wasn’t originally made for the MacBook Neo. TSMC manufactured the processor for the iPhone 16 Pro.
Some of the chips weren’t perfect — one of the GPU cores failed. But rather than throwing them away, Apple saved the imperfect processors for use in the MacBook Neo. That’s a common process called “chip binning.” The clever bit of recycling made the processors very inexpensive.
Producing more MacBook Neo units requires more A18 Pro processors, and these won’t be nearly as cheap because they can’t come out of the recycling bin.
“Apple must also ask TSMC for a hot lot of A18 Pro chips,” Culpan wrote. “While TSMC may forego massive price premiums for a hot-lot run, the SoC will still be more expensive than the first batch because they’ll mostly be top-tier rather than downbin versions.”
The analyst pointed out another factor putting price pressure on Apple’s entry-level laptop.
“DRAM prices have escalated since the initial production run, driving the Neo’s bill of materials much higher,” said Culpan.
He noted that Apple might be forced to nix the $599 version of the MacBook Neo and offer only the $699 variant, which adds Touch ID to the keyboard. That would help cover the increasing bill of materials for producing the product.
- See also: The best time to buy a Mac is right now
The MacBook Neo is Apple’s entry-level laptop. It boasts Apple’s signature all-day battery life and ease of use. It can swim through web browsing, document editing and other basic tasks. But if you want higher specs than its 8GB memory or the maximum 512GB storage, the MacBook Air is a better choice.
- 16-hour battery life
- Comes in four bright, fun colors
- Thin and light design
- No MagSafe charging
- USB 3 and USB 2 ports
- No support for high-resolution displays
Ed Hardy has been writing full-time about tech for 25 years, and using it for much longer than that. His intro to Apple was a Macintosh SE/30 (which he still has), but now he uses a 13-inch iPad Pro as his primary computer.
That’s because he’s a “tablet first” type of guy. Rather than use a Macbook, he connects a keyboard case to the iPad. And instead of a desktop Mac, he connects his tablet to a 27-inch display and full-size keyboard. (So don’t try to tell him that everyone has to use a Mac to be productive.)
Before coming to Cult of Mac, Ed wrote for NotebookReview, TabletPCReview and Brighthand, as well as other sites.
