It appears the ride on cheap computer pricing is coming to an end, as the ‘China Effect’ is about to end. The days of cheap materials and cheap labor may become a thing of the past as the 3 major computer suppliers start to negotiate with companies such as HP, Dell and Acer over cost. In a recent articles it states:

Global retail prices for laptop computers are set to rise as contract manufacturers seek to raise prices for the first time in the face of rising raw material and assembly costs.

PC users have got used of falling prices in the past decade as the sophistication of the units has risen with each new model range. However, the so-called “China effect” on global manufactured goods prices is ending.

The Financial Times reports today that Quanta, Compal and Wistron, the world’s three largest notebook contract manufacturers by output, are in talks with their customers – branded computer vendors such as Hewlett-Packard, Dell and Acer – on how to share the burden of rocketing prices for key materials. Labour costs in China, where the manufacturers have their main production bases, are also rising.

“We will be raising prices for the first time,” said Ray Chen, chief executive of Compal, which expects to account for 25 per cent of the global market this year, told the FT.

This is just another sign that we are becoming a global economy and can no longer depend on cheap labor and parts to keep prices down.

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Full article is here.

Tags: computers, cheap, china, hp, dell, acer, companies, economy