Apple has started production on the chipset that will power its next smartphone, according to a new report.

The all-new processor is tipped to be faster and more efficient than its predecessor, which could result in markedly better battery life in the forthcoming iPhone models.

Apple is tipped to make the switch from a 10-nanometre chip design, like those used in iPhone 8, iPhone 8 Plus and iPhone X, to a more compact seven-nanometre chip.

This smaller A12 design should increase efficiency, resulting in faster speeds on the new iPhone.

The new design would also save precious space inside the handset, which could enable Apple to add new hardware components that it would previously have been unable to fit.

Apple has long battled to conserve space inside its iPhone models even going so far as to drop the ubiquitous 3.5mm headphone port to conserve space inside the smartphone.

According to anonymous sources speaking to Bloomberg, Apple manufacturing partner TSMC (Taiwan Semiconductor Manufacturing Company) started production of the new chipset this week.

However, a TSMC spokesperson would not confirm whether the chips in production were for Apple.

Daily Mail