PC prices may rise next year

As COVID-19 vaccines make cargo space limited.

Demand for electronics boomed in 2020 as the world dealt with stay-at-home orders and lockdowns. But while this is good news for PC makers, it has also led to logistical challenges, especially with many PC components being in short supply. In the coming months things might get worse as PC makers will have to compete for cargo space with COVID-19 vaccines. In the end, PCs may get more expensive than they are today.

The COVID-19 pandemic had a disruptive effect on all major supply chains. Normally, PC makers, as well as suppliers of various PC components, use air freight for their premium and latest products only. Due to numerous interruptions in the supply chain, the mix of air shipments rose in the recent months, increasing costs. To make matters worse, there are shortages of PC components, including CPUs, display panels and graphics cards.

Among the particularly important components that are in short supply today are LCD panels. These commodity products consist of ingredients – liquid crystal array, backlighting, T-Con boards, drivers, inverters and more – made at different locations. If one of the elements is missing, the panel cannot be assembled.

In the coming months pharmaceutical companies and governments are expected to start shipping COVID-19 vaccines, using, at least initially, use a lot of air freights. As a result, already elevated air freight costs are likely to increase again. Normally, around 20 percent of notebooks are shipped by air freight, Canalys CEO and president Steve Brazier told The Register. Currently, that number has increased to about 30 percent.

Due to high demand, component shortages, and increasing air freight costs, PCs may get more expensive in 2021. “The cost of air freight has been rising all year because, quite obviously, there have been very few planes in the sky,” Brazier told The Register. “The arrival of the vaccine will mean that there is yet more competition for the very little air freight capacity that currently exists in the world. … In the old days, only fools bought new PCs for Christmas because they were always so much cheaper in January. That will not be the case this year, when prices could well rise in the New Year.”

“In the coming months pharmaceutical companies and governments are expected to start shipping COVID-19 vaccines, using, at least initially, use a lot of air freights. As a result, already elevated air freight costs are likely to increase again.”