Marmite's not the only national treasure hit by Brexit. Will someone think of the PCs?
Price hikes AGAIN as pound wobbles against the dollar
Marmite-aggeddon? Blame Brexit. The implosion of the UK’s Labour Party? Blame Brexit (more so leader Jeremy Corbyn). Now it seems analysts want to put the sickly British PC market onto the list of things gone awry.
The crystal ball-strokers at Gartner have forecast weak demand for traditional client devices for 2016 - shipments are projected to decline eight per cent, which is worse than forecasts prior to the EU referendum.
A bunch of PC makers including Dell, Lenovo, HP Inc and Asus upped prices in the wake of the vote, claiming the collapse in the value of sterling versus the US dollar had put more pressure on margins.
Research director Ranjit Atwal said additional price hikes were likely given the 15 per cent depreciation in the UK currency in the hundred plus days since Brexit, including A seven per cent fall in the last ten days alone.
“Consumers and businesses should expect further price increases,” he told us. “Every time there is a swing in the currency it makes it more difficult for the vendors to manage.”
This, he predicted, would dampen hardware sales as some businesses could delay spending on PCs and potentially, where possible, upgrade existing stock with Windows 10.
“Uncertainty seems to be getting more dramatic and so businesses may start to think about cutting budgets and one area that could fall is PCs…. PCs won’t be at the top of companies’ spending agendas.”
The PC market was suffering way before Brits voted to leave the EU; UK sales last grew in 2014, when Microsoft called time on support for Windows XP and organisations rushed to upgrade their PC estate. Since then, sales shrank six per cent in 2015 and are set to drop again this year.
Brexit seems to have been used by a few vendors as a scapegoat for weaker-than-expected results, HPE, Rackspace and Alternative Networks among them. Others including Computacenter said they'd seen little change.
Channel sources we spoke to said the PC vendors had yet to react again to the forex swings, but all expected more change.
Dell, which was the first to up its prices in July, sent us a statement:
In line with the rest of the industry, our component costs are price in dollars, and unfortunately, the recent strengthening of the US Dollar versus Sterling and other currencies in the EMEA region following the UK’s decision to leave the European Union, will have a direct impact on the price we sell some of our products to the UK enterprise customers and partners.
The exact price change will vary across our portfolio. We understand that this is an uncertain time for many British businesses and we will continue to work closely with our customers and partners to provide great value products and services.
A PR rep at HP Inc was more brief in his response to us: “As an international company, HP adjusts prices based on exchange rates and currency fluctuations.”
El Reg has asked Lenovo, Acer and Asus for comment and will update this story if/ when they reply.
Updated Acer UK has made contact and told us it is "continuing to watch and monitor the effect Brexit continues to have on the GBP, if the value continues to fall as predicted and currently indicated – we will certainly have to look at pricing in the UK for later this year. ®