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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  • 6 Posted by bpschmil@sbcglobal.net on Thu Sep 3, 2009 3:12PM EDT Report Abuse

    We can't blame the Chinese. We can't blame the falling dollar. We can't blame the working class in China. We can't blame the olympics. This all goes back to high energy prices and USA leadership skills. Get rid of our Republican thinking and policy and in another 10 years we should be back to some normalcilly. I am even in doubt that a new administration can fix our problems. The Democrats have control of congress now and things still aren't changing. It might be time to start learning arabic.

  • 7 Posted by terrobias@att.net on Thu Sep 3, 2009 10:01PM EDT Report Abuse

    I never buy Chinese product/s for reason of its quality standard. I just dont understand why some are happy with them. Buy today broken tomorrow. Please wakeup guys. thanks

  • 8 Posted by motherpuncher@sbcglobal.net on Thu Sep 3, 2009 7:26PM EDT Report Abuse

    Prices up in China??? Good. Then maybe large corporations will stop producing so much over seas!! It's time to bring these jobs back to America.

  • 9 Posted by kak7757@prodigy.net on Thu Sep 3, 2009 4:46PM EDT Report Abuse

    I do not believe we are completely depending on China for electronics. We do get some electronics from Malaysia, Mexico and some from South Korea too. I am not sure about TVs, I believe Japan also makes some. I guess it's better to wait until olympics are over because people naturally try to buy a new TV during olympics time.

  • 10 Posted by mugupo on Thu Sep 3, 2009 7:30PM EDT Report Abuse

    Depend what electronic you planning to buy, now probably best deal for shopping pc or pc hardware, nearly all parts in on sales; has a lot to do with slow economy; so they has to cut price. but once that stimuls check comes in, I expect many item price go back up. Now is good time I think.

  • 11 Posted by sandy43935 on Thu Sep 3, 2009 9:03PM EDT Report Abuse

    I would love to buy a new computer, a new digital camera, all the new toys. But I can't. I can't because I am driving 50 miles every day for work and putting gas in my car at a rate of 3.69 a gallon. That means I'm now spending almost $70 a week just for gas. Good thing I have a small car! But as much as I'd like the luxury of a new toy, I'll just have to make the old ones last. And as for the Chinese workers, screw them. It's because of China that our economy is in the toilet. If it costs too much to make the stuff there, bring the jobs back here.

  • 12 Posted by doc240r on Thu Sep 3, 2009 3:45PM EDT Report Abuse

    @itz_angela: It's not "blame" in the sense that they are doing something wrong. It is accurate to point out that China's attempt to rise from 3rd world status and improve the living conditions of such a large population has global effects. It has had a huge effect on the price of oil (a huge increase in the number of oil consumers and a willingness to pay more than we used to pay in the US). But apart from that, the author was citing a very real situation where supply will be reduced for many products that are usually produced in Chinese factories. FWIW, the only thing I blame China for is trying to black out the sun with all the coal burning factories in the first place. Oh, and Tibet. Can I blame them for Tibet?

  • 13 Posted by hooded_rouge on Thu Sep 3, 2009 4:20PM EDT Report Abuse

    I think its silly for prices to go up on anything electronic. They already over charge for all the stuff they make anyway. Same as automobiles. Rising prices only tells me one thing. They really want to stop making money. Its been proven by the fact that PS2 out sold PS3 and XBOX 360 when those are brand new systems. Its because of what bracket the consumer falls under. American economy is hurting so lets charge more. Thats awesome people greed lives on...

  • 14 Posted by jessicay250 on Thu Sep 3, 2009 4:33PM EDT Report Abuse

    "Blame China...China is tiptoeing towards better relationships with its workers" Is that a bad thing? Is china supposed to treat its workers more poorly so "US Americans"(Miss Teen USA Georgia) can have cheaper electronics? Are US Americans the only ones allowed to have humanely treated workers? Are "developing countries" supposed to stay that way so there can be cheap labor?!

  • 15 Posted by jstar686 on Thu Sep 3, 2009 4:43PM EDT Report Abuse

    Strange how this article is pumped out the very next day that the first wave of people are expected to be recieving their economic stimulus checks....is it hype or is it good marketing?? The reality of the situation is there is a good foundation for making wise financial decisions when buying any kind of electronic gadget, but let's be serious here. Do you really NEED that new TV? Phone? The obvious choice seems to be for the majority of people on where to focus their fund expenditures at the present time is on the cost of living: gas, food, clothing. So don't believe the hype and feel pressured to buy something you Truely Do NOT Need.

  • 16 Posted by gabeownjoo on Thu Sep 3, 2009 4:05PM EDT Report Abuse

    Ooh, yeah guys. Let's blame China. Let's blame China for this guys run-on sentences! Jesus, it's time to pull these jobs back to America. It's not so good if we depend on everyone else, now is it? No wonder people claim to be Canadian over the internet. God forbid 8-year-olds aren't dying to make us those Hollister shirts, right?

  • 17 Posted by kaiserwil9370 on Thu Sep 3, 2009 4:46PM EDT Report Abuse

    For those that bags on Chinese products. News flash, your ipod is made in China.

  • 18 Posted by joeyblue1178 on Thu Sep 3, 2009 4:38PM EDT Report Abuse

    How about easing off a little buddy? You wanna talk about puntuation marks? Not everyone that is posting on here is looking to impress a publishing house. I'm sorry you didn't get published, but, thats no reason to correct people that are commenting on articles. As far as China is concerned, I think we should tell them to eat the 3 trillion we owe them and close our doors on their cheap labor. It's time to focus on our own country and our own economy. We have paid attention to the rest of the world for so long and now we are losing our own integrity.

  • 19 Posted by xxxwilman on Thu Sep 3, 2009 10:53PM EDT Report Abuse

    Mmmmm when the factories start to work again, will the prices drop again??

  • 20 Posted by pjoe25 on Thu Sep 3, 2009 8:13PM EDT Report Abuse

    Funny how yesterday the news was telling us how the retailers wanted to get our refund checks and today the news tells us to buy now because the prices will go up next year.

  • 21 Posted by krowland98 on Thu Sep 3, 2009 4:54PM EDT Report Abuse

    When the price goes up, often the units sold goes down. China relies on manufacturing volume to be competitive. If the consumer responds wisely, price increases won't be sustainable.

  • 22 Posted by kenbefound on Thu Sep 3, 2009 4:49PM EDT Report Abuse

    I am still in shock over the escalating gas & home heating oil prices. I worked hard this past holiday season as a reseller on ebay to invest in a plasma TV for the new year. The majority of my profits went into the increased gas & heating costs so no new TV for me. And for the first time in years I am seeing my bank account balance decrease. And I%

  • 23 Posted by marine_60061 on Thu Sep 3, 2009 7:07PM EDT Report Abuse

    This article is a joke. Suggesting we buy items now, which just happens to be the same time everyone is starting to get their tax rebates. While the price of consumer electronics may go up, I sincerely doubt there is any point "investing" (does the value of electronics ever go anywhere but down?). I smell a corporate PR company behind this article.

  • 24 Posted by shysteeboi on Thu Sep 3, 2009 9:21PM EDT Report Abuse

    Check out www.oktipus.com for other tech tips, etc!

  • 25 Posted by gary_s_wade on Thu Sep 3, 2009 4:06PM EDT Report Abuse

    #13...if you are only getting 13 miles to the gallon then you are part of the energy problem! Quit complaining.

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