Siri, will the iPhone 5 impact U.S. GDP?
Wall Street wants to know, and at least one economist is already predicting Siri will say “yes.”
Sales of the iPhone 5, expected to begin later this month, could add one-quarter to one-half a percentage point to the growth rate of U.S. GDP in the last quarter of 2012, according to Michael Feroli, JPMorgan Chase’s chief U.S. economist.
JPMorgan analysts estimate about 8 million new iPhones will be sold in the U.S. and sales of older iPhones will continue “at a solid pace” in Q4, Feroli wrote in a research note. Each phone will likely have a $400 trade margin ($600 for the phone minus $200 import costs), which means a $3.2 billion year-end GDP bump.
If Feroli’s estimates are correct, the iPhone 5 would boost the country’s GDP by $12.8 billion at an annual rate, which means a 0.33-percentage point increase in GDP growth, he said.
But Feroli hedges: “This estimate seems fairly large, and for that reason should be treated skeptically.”
JPMorgan’s Q4 sales estimates are actually much lower than Piper Jaffray analyst Gene Munster’s, who told Bloomberg as many as 10 million iPhones could sell in September alone. And in an interview with AllThingsD, Munster estimated sales for Q4 could reach 23 million.
The picture might become clearer when Apple Inc. unveils the new smartphone tomorrow at an event in San Francisco, where Chief Executive Officer Tim Cook will announce the new design’s larger screen and thinner body, according to two people familiar with the matter. Apple kept the iPhone body the same in last year’s upgrade, so the design overhaul is the first since 2010 — contributing to the expected increase in demand.
So if Apple ships its new iPhone the third week of September, as expected, and sales hit anywhere near Munster’s predictions — and contribute to a noticeable bump in the GDP — what does this mean for the election, if anything?
The first estimate of third quarter GDP comes out on Oct. 26 — just 11 days before the election. Those last minute, undecided voters just might take notice of good economic numbers, and a nice GDP bump.
As to who they will credit? You’ll have to ask Siri.
Lauren Vicary, Alex Tanzi and Marcus Chan contributed to this post.