The Redmi K30 costs to manufacture $250 and you can buy it for $284


This week, we had one of the most important presentations of Xiaomi so far this year, the launch of Redmi K30, its first mid-range phone compatible with 5G networks. This feature so far we had only seen in high-end phones, with very high prices, usually even above $1,000 (except for Xiaomi models themselves). The K30 5G will be released for a price of around $284, but how much does it cost to manufacture?

Well, apparently a Chinese analyst has calculated the costs of all the components found inside this Redmi K30 5G, without taking into account the expense required by the research and the development of the phone itself and its distribution. Only the physical value of the hardware. The truth is that the final conclusion is surprising, because we could say that Xiaomi could even be losing money with the Redmi K30 5G.

The manufacturing cost of Redmi K30 5G is almost the same as the purchase cost

A few weeks ago we talked about the reason why Xiaomi phones were so cheap. Basically, it was because the profit obtained by the brand of the sale of each unit was between 8 and 9% of the value of the product. Well, with the Redmi K30 5G it could be even smaller. According to this Chinese analyst, the value of all components of the Redmi K30 5G is 1,730 yuan. Which at the current exchange is $250. The official price of this phone for its 6 + 64 GB version is 1,999 yuan $284.

We are talking about the benefit that Xiaomi would obtain is about $34, a little more than that percentage that we were talking about before. So what is the problem? Well, this manufacturing cost is only of its components. At this price, it would be necessary to add the cost of development, manufacturing, distribution, promotion, etc. That is, with virtually every Redmi K30 5G that sells the brand, the benefit is nonexistent or very low. Also, if the phone offers come later, we could even be talking about losses.

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5 Comments

  1. newphoenix
    December 14, 2019

    and the cost of 4G (LTE) k30 components is $170, redmi forgot to put amoled screen and this is a big minus.

    • OrangePumpkin611
      December 17, 2019

      more of a selling point in the Pro version that is coming next year with 865 I guess

  2. zalde cerna
    December 15, 2019

    a loss if it sell one unit.

  3. Dave Burstein
    December 16, 2019

    Thanks for this, but could you point me to the original source for the component price? Xiaomi is “forward pricing.” Huawei and China Mobile didn’t expect prices like this until the summer. That’s not a bad strategy sometimes. The low price builds the volume to a point the company gets better parts prices. Low prices also build demand, for this and other Xiaomi models.
    There are nine 5G phone makers in a market where it will be hard for even 4 or 5 to be profitable. Xiaomi has no choice but to find dramatic ways to break out of the pack.
    The price of components are usually confidential. Breakdowns like this are based on analysts estimates. That isn’t always accurate however, because manufacturers sometimes reduce prices to strategic reasons. In particular, this is the first phone with the Mediatek 5G chip. Mediatek may be pricing very low to get a reference customer. Dave Burstein

    • OrangePumpkin611
      December 17, 2019

      This does not use a 5G MTK chip though, it’s the Snapdragon 765G