Xiaomi CEO Lei Jun warned that smartphones may become more valuable in the coming years as memory chip prices continue to increase across the industry. Speaking at the launch event of the Xiaomi 17 Max model, Lei Jun stated that users who systematically renew their phones every year should not postpone their purchasing decisions.

Lei Jun stated that ongoing component cost increases could push up smartphone prices in the future. Reminding that the company was one of the first brands to warn about the increase in memory prices last year, the manager emphasized that this cost pressure is expected to continue for at least two more years.

Increasing costs and price expectations

The rise in storage and memory prices directly affects the production costs of smartphones as well as other consumer electronics products. Xiaomi states that it is trying to reduce the reflection of these cost increases on customers by increasing supply chain efficiency and making technological optimizations.

Lei Jun stated that the company is trying to cover some of the additional costs internally, but if memory costs continue to increase at the current rate, it may be difficult to keep prices constant. Xiaomi Group President Lu Weibing shared similar concerns in a recent live broadcast.

Price increases continue in the sector

Lu Weibing predicts that some premium flagship smartphones from Chinese brands may exceed 10,000 yuan, or approximately $1470, by the end of this year. Stating that the current upward trend in memory prices may continue until at least the end of 2027 and may extend to 2028, Weibing stated that the pressure on critical components is not expected to ease in the short term.

The smartphone market has already begun to feel the effects of increasing component costs. Since March, many smartphone models in China have experienced price increases of between 200 and 400 yuan due to cost increases.

How do you think this rising trend in smartphone prices will change consumers’ habits?