Acer is raising prices on their PCs/notebooks for the first time in 5 years. Demand must be as weak some people are claiming, lol.
Acer reveals rare price increase
By Robin Kwong in Taipei
Published: June 21 2010 02:01 | Last updated: June 21 2010 02:01
ft.com
Acer, the world’s second-largest PC company, has managed to raise the price of its products for the first time in five years, as strong demand offsets the impact of rising cost pressures.
“Average selling price has slightly increased for the first time in five years ... it’s a very rare event in our industry but consumers are still happy,” JT Wang, Acer’s chairman, said after a shareholders meeting on Friday.
Mr Wang said Acer had been “dynamically adjusting” prices and its product mix over the past two months but these changes “have caused no damage to end demand. End demand is still very strong”.
The global technology sector has enjoyed a resurgence in consumer demand since last summer after the financial crisis but PC makers such as HP, Acer and Dell are now facing rising cost pressures on several fronts.
Pull-backs in investment by suppliers during the financial crisis have led to shortages that are pushing up the prices of key components such as D-Ram memory chips.
Recent labour unrest in China, where most computers are assembled, is leading to higher wages that contract manufacturers such as Foxconn hope to pass on to their customers.
The euro’s recent fall in value has also prompted PC makers such as Acer and Asus to take hedging measures to mitigate the currency risk.
However, Mr Wang said such challenges were not out of the ordinary.
“These conditions haven’t changed in the last 10 years. This is a very competitive industry so some players have exited but we can definitely remain competitive,” he said.
Component prices were likely to stabilise by the second half of this year and labour costs account for just a “very small percentage of the price of a notebook computer”, Mr Wang said.
“In any case, it doesn’t really affect us because if we buy high [from the contract manufacturers], then we’ll sell high [to consumers].”
While sales in some European countries had been adversely affected by the region’s economic woes, others have performed better than expected.
Acer now expects third-quarter sales globally to be 15 per cent higher than the second quarter, up from a previous forecast of 10 per cent.
Acer has arguably benefited the most from the financial crisis as it leapfrogged Dell to take second place, behind HP, in terms of global PC shipment volumes. Earlier this year, Acer also surpassed HP to become the world’s biggest seller of notebook computers.
Mr Wang said this was because “we reacted more quickly than our competitors”.
He added: “When demand all of a sudden came back in the second quarter we were one of the few to take advantage of that because we were prepared very early on.” |
