Experts Brand Apple’s New Lease Strategy: A Cover-Up for Soaring Hardware Prices?

Introduction to Apple’s New Leasing Program

Apple recently unveiled its new leasing program named Apple Upgrade, supported by Klarna. This initiative covers Apple’s range of products including iPhones, Apple Watches, Macs, and iPads.

The program operates similarly to a car lease, offering 12-, 24-, or 36-month leasing terms based on the product. Customers have the flexibility to upgrade to the latest device before the end of their term or return the device once the lease expires.

Apple describes this new payment method as a “more flexible way to pay for products.”

The new strategy could be particularly attractive as it allows consumers to avoid large upfront costs. This could be appealing especially as Apple’s prices have recently increased, providing a way to acquire premium devices without the financial strain.

Understanding How Apple Upgrade Works

Apple Upgrade allows different lease durations for different devices: 12 or 24 months for iPhones and Apple Watches, and 24 or 36 months for Macs and iPads.

Starting prices are quite competitive with Apple Watches and iPads beginning at $11.99 per month, depending on the model and storage capacity. iPhones start at $17.99 per month and Macs at $24.99 per month.

Customers can sign up for the program either online or at physical Apple Stores. Approval involves a soft credit check through Klarna, which should not impact your credit score.

Upon completion of the lease term, the consumer can either return the device, upgrade to a new model, or buy it outright with a final payment.

It’s worth noting that unlike the previous iPhone Upgrade Program, the new Apple Upgrade does not include AppleCare, which now comes as a separate subscription.

Apple Upgrade Pricing Details

Apple’s pricing under the new program includes the entire iPhone 17 lineup, the iPhone Air, both the Apple Watch Series 11 and Apple Watch Ultra 3, and three iPad options – the iPad Air, iPad Pro, and iPad mini. For Macs, available models include the MacBook Air, MacBook Pro, iMac, and Mac Studio.

Generally, Apple sets the default leasing option to 24 months. Costs might vary based on the storage capacity or specific chip versions within each device type. Also, the listed prices do not include taxes and fees.

No Leasing for Entry-Level Devices

It’s important to note that not all Apple devices are eligible for the upgrade program. Entry-level models and the previous generation iPhone 16 and iPhone 16 Plus models are excluded from leasing options.

This exclusion extends to the Apple Watch SE, MacBook Neo, Mac mini, the basic iPad (A16), and the Studio Display.

Program Availability

The Apple Upgrade program is currently available for all the devices listed above. Apple has stated that no security deposit is required and that trading in an old device could reduce the monthly payments.

However, if a lease is terminated early, there might be fees involved. Also, if no action is taken at the end of a lease, a purchase fee will be automatically charged.

Upgrading to a new model or a more advanced version of a device during the leasing period could result in an increase in the monthly payments, especially when new device generations are introduced.

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