Worried about 2026 smartphones getting pricier? According to Carl Pei, co-founder and CEO of Nothing, there are more reasons to worry this year. Pei has predicted that smartphones will become noticeably more expensive in the coming years, driven by escalating production costs, supply chain complexities, and the increasing sophistication of technology. In an interview with Moneycontrol, Pei highlighted that the era of affordable, feature-packed smartphones may be nearing its end as manufacturers grapple with higher raw material prices, geopolitical disruptions, and the rising cost of advanced components.
Pei, who previously co-founded OnePlus and helped popularise the “flagship killer” concept with competitively priced premium phones, explained that the smartphone industry has long benefited from economies of scale and aggressive competition that kept prices in check. However, he warned that several converging factors are now pushing costs upward.
Nothing CEO says smartphones will get pricey
“Smartphones are going to get more expensive in the coming years. The components are getting more expensive, the supply chain is getting more complex, and the geopolitical situation is not helping,” Pei said. He pointed out that critical components such as camera sensors, displays, processors, and batteries are becoming costlier due to inflation, limited supply of rare earth materials, and increasing demand for higher-spec technologies like advanced AI chips, periscope zoom lenses, and larger, higher-resolution screens.
Additionally, Pei noted the impact of global supply chain vulnerabilities, including trade restrictions, tariffs, and regional disruptions, which have made manufacturing and logistics more expensive. He also mentioned that brands are investing heavily in R&D for emerging technologies like foldables, under-display cameras, satellite connectivity, and on-device AI processing — costs that are ultimately passed on to consumers.
Despite the upward price trend, Pei highlighted that Nothing remains committed to delivering value-driven devices. The company has built its reputation on offering clean software, unique design, and competitive pricing, as seen with the Nothing Phone (1), Phone (2), Phone (2a), and the recently launched Phone (3a) series. He suggested that while flagship models from major brands may see sharper price increases, brands like Nothing could continue to offer compelling alternatives in the mid-to-premium segment.
Consumer impact of 2026 industry trends
In 2025, average selling prices (ASPs) for smartphones in India and globally rose modestly due to inflation and premiumisation. Analysts expect this trend to accelerate in 2026–2028 as brands push foldable phones, AI-heavy flagships, and new form factors, while component suppliers pass on higher costs amid raw material shortages (e.g., cobalt, lithium, and gallium).
For Indian consumers, who are highly price-sensitive, Pei’s comments suggest that the window for sub-Rs 30,000 devices with flagship-level specs may shrink, with mid-range phones likely to hover around Rs 35,000–Rs 50,000 and true premium flagships crossing Rs 1 lakh more frequently.