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Lite-on States that component prices will rise the coming two years
Lite-On, responsible for several chips, chipsets, and components (e.g. Plextor) claims that component shortages will drive up prices for the next two years. Passive components price hikes due to shortages will sooner or later send end product pricing up, the consumer market will have to make adjustments in the coming two years.
The components shortages have stemmed from strong demand from makers of automotive electronics and stricter environmental control of production in China, Chen said, adding the price hikes' impacts on end products may appear as early as third-quarter 2018, Chen from lite-on noted, as reported on DigiTimes:
Lite-On Tech mostly uses standard passive components and has seen only slight impact from the shortages, Chen indicated. As for the US-China trade tensions, Chen said based on the US government's announced list of China-made product items for additional tariffs, only some of Lite-On Tech's LED devices and optical disc drives will be affected - 14-15% of the revenues of the former will be affected and below 10% for the latter.
Viewing that demand for SSDs used in cloud computing servers in China is growing fast, Lite-On Tech in 2017 set up a joint-venture SSD maker, Suzhou Lite-On Storage, in eastern China with Suzhou Tsinghua Storage Technology. Lite-On invested US$45 million for a 45% stake and Suzhou Tsinghua has a 55% stake. Suzhou Lite-On Storage began construction of a factory in February 2018 and will start production at year-end at the earliest. Lite-On Tech will close a deal to sell its business units of smartphone-, notebook- and tablet-use CCMs to Hong Kong-based LuxVisions Innovation at US$360 million plus a 20% stake in the latter by the end of June 2018. Lite-On Tech will focus automotive CCMs and has landed 5-year contact supply of automotive CCMs used in ADAS from supply chain makers for first-tier Europe-based automakers.
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Fox2232
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Senior Member
Posts: 11808
Joined: 2012-07-20
#5560667 Posted on: 06/27/2018 09:29 AM
Lol, just send them to jail already. They decided to invest a lot of money into making SSDs. And they claim that around time they are ready for mass production, they expect prices to go up due to low supply and high demand.
When I look around, I see SSDs prices to go down as new better, faster take place in higher price ranges.
Lol, just send them to jail already. They decided to invest a lot of money into making SSDs. And they claim that around time they are ready for mass production, they expect prices to go up due to low supply and high demand.
When I look around, I see SSDs prices to go down as new better, faster take place in higher price ranges.
cryohellinc
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Senior Member
Posts: 3522
Joined: 2014-10-20
#5560668 Posted on: 06/27/2018 09:30 AM
As fantaskarsef said above, most likely yet another cartel agreement.
Personally, I'm VERY curious how this whole Dram agreement will be handled.
As fantaskarsef said above, most likely yet another cartel agreement.
Personally, I'm VERY curious how this whole Dram agreement will be handled.
Netherwind
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Joined: 2009-11-13
Senior Member
Posts: 8278
Joined: 2009-11-13
#5560676 Posted on: 06/27/2018 09:47 AM
How can prices go up due to shortages when everybody says that we buy less and less hardware and that PC gaming is in danger. Like @fantaskarsef says, it's just cartel all over again. Greedy bastards!
How can prices go up due to shortages when everybody says that we buy less and less hardware and that PC gaming is in danger. Like @fantaskarsef says, it's just cartel all over again. Greedy bastards!
fantaskarsef
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Joined: 2014-07-21
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Posts: 13785
Joined: 2014-07-21
#5560679 Posted on: 06/27/2018 09:56 AM
Most of all, their own press release says they built a new factory, and that they will cater to the "first tier" automotive customers at first. It's not like they earn less money with automotive stuff when they build an extra factory for it
So please, if my logic is faulty here, anybody feel free to teach me different, but my common sense just calls BS.
Most of all, their own press release says they built a new factory, and that they will cater to the "first tier" automotive customers at first. It's not like they earn less money with automotive stuff when they build an extra factory for it
So please, if my logic is faulty here, anybody feel free to teach me different, but my common sense just calls BS.
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I don't know, I'm always sceptical when a company tells you it's going to fight shortages in the next two years that will drive prices up.
They already know about shortages in 2020? Although they just built a new factory themselves for more production? That doesn't make sense, either one of those can't be true, since it's silly to build a new factory when you already know you don't get the components due to shortages.
The reality is, it's a shortage created by themselves as they cater to automotive sectors first, before consumers. And to me it sounds like that's their own excuse to charge more for consumer products, keeping their revenue up because they can't sell as many units anymore.
After all, it reads like "Hey, we warn you, we're going to charge you more because we actually don't want to sell you our stuff as much as before anymore".