Smaller PC Manufacturers Suffering from Undersupply of Intel CPUs

An undersupply of Intel CPUs is affecting small and mid-size PC manufacturers. According to industry sources, the prices of the CPUs rose by 50,000 won (US$45) per unit to over 100,000 won (US$90), showing a volatility greater than those of gold or oil.

The undersupply dates back to late August. At that time, distributors handling Intel processors notified PC manufacturers, including Hansung Computer and Jooyon Tech, of the possibility of supply shortage. Intel previously notified major PC manufacturers in multiple countries so that they can avoid a laptop and desktop supply failure.

Larger PC manufacturers such as Samsung Electronics, Lenovo and HP already secured processors after the notification. “Intel promised a smooth supply until March next year so that products can be supplied without problems until then,” said managing director Lee Min-chul at the PC business unit of Samsung Electronics.

The story is different for smaller PC manufacturers. They need to purchase processors on an ongoing basis because they have no bargaining power based on the economy of scale. The price of the eighth-generation Intel Core i7-8700 processor rose from 350,000 won to 460,000 won between January and last month although it fell to 430,000 won or so more recently.