Is now the time to buy consumer electronics?

Thu Apr 24, 2008 12:48PM EDT

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They say there's no time like the present, and according to Richard Glikes, executive director of the Home Theater Specialists of America, that goes doubly so for buying electronic gadgetry. The reason? Blame it on China.

Given the state of the U.S. economy, spending your disposable income on high-tech toys may not seem like the best investment in 2008. But if you've already decided to purchase a TV or a new phone, you might be inclined to wait for prices to go down.

That might be a long wait, says Glikes. China is the production center for the vast majority of consumer electronics, and the heyday of cheap labor there may be rapidly coming to a close. For starters, blame the Olympics: In order to clear the air of pollution, many factories are shutting down in June, which could put a damper on the supply of many products. Also, China is tiptoeing towards better relationships with its workers: New labor and worker protection laws have pushed labor costs up 15 percent. The price of many components and metals used in making electronics is also going up.

Perhaps the biggest culprit of all: The falling U.S. dollar. The poor old greenback just doesn't go as far as it used to. Most notably it is falling against the euro, but it's also fallen considerably against the Chinese yuan, about 10 percent in the last year. In other words, if paid in dollars, Chinese companies now earn 10 percent less than they did a year ago due solely to the falling exchange rate. One can imagine that doesn't sit well with them.

In other words: Current prices may simply not be sustainable, and thus price increases may soon be on tap in order to shore up profits. Sure enough, prices are already going up for some LCD products. At the manufacturer level, says Glikes, prices in China are already up from 8 to 20 percent, and U.S. retail prices are soon to follow. 

Get ready for a bumpy 2008.

More perspective on the data from TWICE. 

Comments on Is now the time to buy consumer electronics?

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  • 26 Posted by mlgfive on Thu Sep 3, 2009 7:23PM EDT Report Abuse

    well go figure... we closed down so many plants in America cause it was cheaper to outsource &/or buy from China. Americans lost their jobs, homes, way of life and now the Chinese people are beginning to want to be treated better and get paid. Guess they will be what America once was. Oh well maybe they will outsource some of their jobs to America. If anyone thinks this doesn't foretell a warning, study basic economics and then look at the United States of America right before the Great Depression. Of course I realize the next depression will be substantially worse and I realize that most Americans can't survive without a grocery store, but oh well we benefitted all the other countries and their GNP - it just cost us our way of life is all.

  • 27 Posted by camaro69boy88 on Thu Sep 3, 2009 3:17PM EDT Report Abuse

    Prices at BetterBuyElectronics.com havent seemed to go up at all.

  • 28 Posted by zynnwyz on Thu Sep 3, 2009 11:02PM EDT Report Abuse

    Silly reports like this will scare the gullible masses into running to the stores to make all of their purchases now before "the prices go up". This will create a larger demand and shorter supply, which ultimately leads to higher prices. This same thing happens with gas prices. The media will say that prices will go up soon, people panic, create long lines at gas stations, and fill up everything they can. This makes the price go up. Don't blame China, blame the gullible panic-driven masses.

  • 29 Posted by ramfn on Thu Sep 3, 2009 8:27PM EDT Report Abuse

    This seems to be just another retail stores funded article to increase sales. China is not closing the factories, it is just in Beging. Shanghai is their business/production capital, which is not affected by the olympics.

  • 30 Posted by stacystec on Thu Sep 3, 2009 9:39PM EDT Report Abuse

    Ah yes, the "buy now" mentality and get it while it's cheap. Can't think of a more rudimentary way of making purchasing decisions. With consumer spending dipping way down and the American corporate culture of cut-jobs-first profit protection, investing in that new plasma tv might be a bit risky. Consumer electronics will always go through its price fluctuations, but considering the price of commodities I would hope that some would play it safe and see how the price of food and oil work out this summer. A plasma TV is nice but you can't eat it.

  • 31 Posted by havok01520 on Thu Sep 3, 2009 4:17PM EDT Report Abuse

    wow, way to go for wanting to support child labor and sweat shops everyone. Cause everyone knows that bi-passing gov't laws regulating labor for cheaper labor created by people dragging themselves in a country that supports practically slave labor is the best way to go. Really can we please have products made by people who can actually use there money for something besides feeding there family, its sickening. And as much as i hate the chinese gov't for begin the cause of so many other human rights violations, at least there starting to do something right, who knows maybe tibet will be free? But really bring the jobs back to america and stop supporting what is practically slave labor. And then maybe we can have real trade where we buy products that are actually chinese and not cheap black market rip-offs created by those ripped-off by the employer that supports it, us.

  • 32 Posted by dwalsh70 on Thu Sep 3, 2009 3:50PM EDT Report Abuse

    Maybe it's time for businesses to start thinking about the end of outsourcing customer service. Consumer electronics in general breaks, wears out, shorts out, all while you're still paying it off. The recession is here. More important to eat than it is to get an overpriced gadget. Expect computer shops, electronics repair and refurbishing facilities to do very well in the next few years. High tech needs to be low priced.

  • 33 Posted by ryan_haochan on Thu Sep 3, 2009 8:57PM EDT Report Abuse

    Don't blame China for everything. Blame yourself for your material society. You are responsible for your own actions.

  • 34 Posted by michaelj94550 on Thu Sep 3, 2009 7:18PM EDT Report Abuse

    I wonder which Tech Company sponsored this "news story."

  • 35 Posted by bfw2080 on Thu Sep 3, 2009 3:06PM EDT Report Abuse

    Shame on you guys for suggesting/implying that improving labor conditions in China is a "Blame it on China" situation. All you guys need to start thinking globally and move out of your American egomaniac bubble. How about " Finally China is improving worker pay and other conditions."

  • 36 Posted by makingfriends_talking on Thu Sep 3, 2009 7:04PM EDT Report Abuse

    this is so not true at all!!! The reason why the american money is falling is becaus of the war thats going on in the middle east. I reall thank that we should stop the war now. if we do not do that then whas happening to us now will just keep getting worst. Its so not china's fault that the american money thats falling. its Us the american's own fault. I just thank that there is just to much people out there do not get a job and relay on the goverment to pay them and those peoples dont have to do anything at all. In china in order for kids to go to school the parents have to pay. no matter if its a public school or a pravit school they have to pay. In america we dont. thats alots of money to. Like money for the teachers and all of the other bills. where do we get those money? us the tax payers. In china its not the tax payer that pays for all of the things. they have to pay for some of the things too. SO americans don't judge other Countrys. If we all can mind our own binness than we will have a better life.

  • 37 Posted by gomez.patel on Thu Sep 3, 2009 4:11PM EDT Report Abuse

    bulldog6769@sbcglobal.net fusses as people for their bad writing skills... and then he places YOUR there instead of YOU'RE. Too funny!!!!!

  • 38 Posted by nathanimus on Thu Sep 3, 2009 7:34PM EDT Report Abuse

    You guys are right, the prices probably wont go up and this probably is some attempt to increase buying. Funny that this is coming out right as the federal rebates are coming out! Never heard of Better Buy Electronics, mentioned in post 33, but the prices do look good. Maybe its just the brick and mortars increasing their prices.

  • 39 Posted by smms101 on Thu Sep 3, 2009 9:30PM EDT Report Abuse

    Wheres the proof? I can read but is it true? Haven't you people ever heard of LIEING ON THE INTERNET??!!

  • 41 Posted by sunshine95us on Thu Sep 3, 2009 9:48PM EDT Report Abuse

    "For starters, blame the Olympics: In order to clear the air of pollution, many factories are shutting down in June" most of PC or electronics parts manufacturers are located in far south of China and they are far from Beijing where the Olympics will be held, it doesn't matter with this point. I don't know who told this above,

  • 42 Posted by amycook13 on Thu Sep 3, 2009 2:53PM EDT Report Abuse

    Here's an idea, instead of spend our rebate checks, let's save them.

  • 43 Posted by robx007 on Thu Sep 3, 2009 8:46PM EDT Report Abuse

    This article is all wrong - prices will not go up - it's all just "fear" put in the keep Americans spending their $

  • 44 Posted by pbm517 on Thu Sep 3, 2009 8:04PM EDT Report Abuse

    When the chinese have nobody to sell to the prices will drop again.

  • 45 Posted by e_anderso2001 on Thu Sep 3, 2009 3:57PM EDT Report Abuse

    I don't think this is a rant page for being prim and proper, There is a site for that. But as a component level repairman, I have never seen a year where I have repaired more "made in China" units ranging from capacitors and diodes on motherboards to flat screen TV's. Although I'm enjoying the money and the business, I also send up the red flag when I see the made in China label.

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