Channel faces more PC price cuts this autumn

Unless confidence in the PC market begins to recover in the next few weeks, the channel will be forced to make significant price cuts.

Unless confidence in the PC market begins to recover in the next few weeks, the channel will be forced to make significant price cuts in the autumn or face being lumbered with piles of outdated hardware stock, according to Gartner.

“If demand, especially from consumers, remains weak there might be some old stock left in the channels ahead of the Windows 8 launch in October,” said Meike Escherich, principal analyst at the tech research house.

Generic PC“This could lead to significant price cuts in September, and challenges may arise in selling new products into the channel in the third quarter of 2012,” she said.

Last month Gartner sounded the alarm over a growing pile of unsold Windows 7 kit stacking up in the global supply chain, but has now turned its attention to the state of the Western European market and revealed worrying evidence of a similar picture on the regional level.

The bean counters revealed today that PC shipments in Western Europe fell 2.4% to 13.6 million units over the second quarter of 2011. Mobile PC shipments were up a bit, but this was offset by a 12.8% decline in desk-based machines.

The professional PC market declined 5.3%, while the consumer market was flat, ticking up 0.4%

In the UK, 2.5 million units were shipped during the three months to the end of June, a decline of 7.6% year-on-year, with both professional and consumer sectors waning yet again, according to research director Ranjit Atwal.

Atwal revealed that as a result of this, the three largest vendors in the UK market – HP, Dell and Acer – were all forced to hold back on price promotions as they came under pressure to protect what little margin remains.

All three of them saw double digit shipment declines as a result, with Dell hammered the worst, down 23.2% (40% on consumer), while market leader HP fell 11.7%, and third-placed Acer 14%.

The other two top five players in the UK market, Toshiba and Apple, did see some growth, with Toshiba up 51.6%, albeit following a very weak Q2 last year, and Apple 10%. Note that Gartner does not include tablets in its stats.

Atwal said there was now a “real worry” over whether or not the UK PC market would ever return to solid growth.

“Windows 8 and ultrabooks now look even more important,” he said. “However, messages emerging from the PC supply chain remain inconsistent and largely uninspiring. This has resulted in the PC channel holding back on new shipment orders until the fourth quarter of 2012.”

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