Laptop prices expected to rise too
A display of laptop computers at a Costco warehouse store in Richmond, Calif.
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KAI RYSSDAL: It's seemed lately that everyday I have to tell you about the rising cost of something or other. Today, again, it's oil at a record. Rice hit its limits at the Chicago Board of Trade. Electronics, computers in particular, have dodged the price bullet so far.
They're getting more powerful and cheaper all at the same time, but Marketplace's Lisa Napoli reports that's about to end.
LISA NAPOLI: Ninety-five percent of the world's laptops are made by Taiwanese companies, three companies in particular, whose names you don't know. They make laptops on behalf of the brands you do, like Dell and HP and Toshiba. Over the last decade, production of the laptops has shifted from Taiwan to China. Same old story, it was cheaper to make them there. Computer industry analyst Jeffrey Wu of iSuppli says that's changing now.
JEFFREY WU: Because the increased gasoline prices, petroleum prices and all the resin that goes into the product, plastic casing.
Just about everything that's needed to make a laptop is getting more expensive. In particular, the key elements of rechargeable batteries, like cobalt and nickel, and Wu says there's another problem.
WU: The rising labor costs in China, because of new labor laws being implemented and carried out.
In the past, computer makers resisted passing along higher costs to consumers, because it put companies at a competitive disadvantage. Now, they may have no choice, but Jason Oxman, of the Consumer Electronics Association, says that's not necessarily the end of the good laptop deal.
JASON OXMAN: Having 10 models to choose from at Best Buy for under $600, that suggests pretty fair pricing for consumers.
Not to mention, we're hooked. Oxman says laptops already make up 51 percent of computer sales, and that figure is rising.
In Los Angeles, I'm Lisa Napoli for Marketplace.