Inflation effect: consumer goods to cost more
From desktop computers to TV sets, refrigerators and washing machines, consumer electronics are the latest to come under the shadow of rising inflation, reports HT Correspondent.business Updated: Jun 03, 2008 22:04 IST
From desktop computers to television sets, refrigerators and washing machines, consumer electronics are the latest to come under the shadow of rising inflation.
Manufacturers of these goods have either raised or are planning increase prices over the next few months, as they apparently are unable to absorb a sharp spike in costs of raw materials and components, especially steel.
This is the first time in many years that consumer electronics and computer makers in India have increased prices, which consistently fell over the past decade as the government cut duties and brought policies to encourage more production and competition in this segment.
Computer maker Hewlett Packard said it will increase prices of its laptops in India by 13 per cent. This means a an HP laptop that now comes for Rs 40,000 will cost Rs. 45,200 excluding local taxes. Lenovo, the world’s third largest PC maker, plans to follow suit. “This must be an appropriate time to hike prices," said Anil Philip, executive director, Lenovo India.
Similarly, LG Electronics India, the subsidiary of Korean consumer electronics major LG, has announced that it will hike prices of monitors and its brand of CD/DVD writers by 7-10 per cent, R Manikandan, Business Group Head at LG said in a statement. According to industry sources, there could be minor price hikes on high-end mobile phones.
One of the reasons for manufacturers to increase prices is the global rise in component cost arising out of a shortage and the depreciating rupee against the US dollar.
“The primary reason for this hike is dollar appreciation coupled with price hike for some components," said Rajiev Grover, Director – Consumer Products, Personal Systems Group, HP India. "We will be increasing the prices with immediate effect and over the next few days the hike will be extended to the entire notebook range,”
“Since most components that go into laptops and other gadgets are imported, any fluctuation in the dollar will impact the prices of these products,” says Vinnie Mehta, Executive Director, MAIT, an IT hardware association.
The price hikes also extend to household appliances.