Expensive components drive PS5 production costs to $450 per unit

The PlayStation 5 will cost around $450 per unit to manufacture, according to inside sources.
Speaking with Bloomberg, people at Sony with knowledge of the matter said the cost of high-end components -- especially around heat dissipation -- had driven up production costs.
Console manufacturing is typically a narrow margin or loss-leading endeavour; the PS4 launched with a price point of $399 in 2013, and market intelligence firm IHS Markit estimates manufacturing costs were around $381 per unit.
Historically, console launch price has proven a delicate topic, as evidenced by the PS3 introductory price of $599, which Sony exec Shawn Layden later described as a "stark moment of hubris" after the record-breaking success of the PS2.
Microsoft made a similar misstep with the Xbox One, launching the console at $499 in 2013.
As Sony one again enters a new generation after having dominated the previous one, the platform holder finds itself in a delicate position when it comes to pricing -- one source said the Xbox retail price will be a deciding factor.

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