If you're planning a new PC build (opens in new tab), it might be a good idea to put the power supply at the top of your hardware purchase list. Current pricing trends show that power supplies are getting much more expensive, and there doesn't seem to be any sign that pricing will stabilize anytime soon. We dug into the matter and pressed our contacts within the PSU industry to find the root issues behind the skyrocketing power supply pricing.
First, let's outline some examples: In January, the Corsair CX450 (opens in new tab), which we consider to be the best budget power supply, retailed for as low as $49.99 at Corsair's online store. It's was unavailable for a period of time, but that same unit currently retails for up to $64.94. That's a whopping 30% price increase in a matter of seven months. The Corsair RM550x's (opens in new tab) selling price has also increased by 15%.
The price hikes don't just affect the low-capacity units, either. We also found price increases with the more premium units, like the Corsair AX1000 (opens in new tab) or AX1600i (opens in new tab). However, it would appear that the higher-end models don't suffer as drastically as the budget units. For example, the Corsair AX1000 and AX1600i's price tags are 9.6% and 7.7% higher, respectively, than they were in January. It's likely that the margins are higher on the higher-end models, which makes it easier for the companies involved to absorb some of the increased costs.
Wholesale power supply pricing in China has risen slightly, but it varies. Component prices and labor became more expensive, but the impact on the higher pricing is negligible. Our sources tell us that the price increases range anywhere from 0 to 5%, depending on the vendor and the model of the unit, which doesn't fully explain the big price hikes we see at retail.
According to our sources inside the power supply industry, the problem largely boils down to logistics. Air cargo costs have skyrocketed over the past few months, as the impact of the coronavirus pandemic has hit the shipping industry hard. In the past, it cost $2 to $3 to ship a kilogram, but these days, companies pay up to $10 to ship the same amount of weight. That obviously has an impact on pricing, and limited affordable air cargo pricing can cause a ripple effect of delayed shipments, too.
To put things into perspective, if a power supply vendor was to put in an order with CWT (Channel Well Technology, a popular PSU component design company) today, the shipment will likely not arrive in the U.S. until late January.
|Model||Retailer||January Pricing*||August Pricing*||Price Difference|
*Pricing according to PCPartPicker.
Earlier this year, the coronavirus pandemic paralyzed China's production industry for a few months. The halt in production caused a power supply shortage, but demand didn't let up. In fact, the industry has seen unanticipated growth in the desktop PC market as the new paradigm of widespread remote working took hold, which means demand has increased.
We all know what happens when there's a significant gap between demand and supply: price gouging sets in. Or, as some in the industry call it, 'shortage premiums.'
In effect, the power supply situation is comparable to the mining boom from a few years ago. The supply chain becomes stressed and lead time increases as cheap units sell out, which then has the knock-on effect of driving up pricing on the more costly models, too. Basically, this is the landscape that PC builders will have to navigate for the foreseeable future. There really isn't a precedent for the disruptive impact of the pandemic, so it's anyone's guess when logistics will stabilize.
The implications of more expensive logistics aren't just limited to the power supply market, either. Retail businesses are also feeling its effects. As an example, Banggood, a popular Chinese e-commerce website, used to offer free shipping on many products. The same products now carry a $2 to $3 shipping fee at a minimum.
Unfortunately, the negative impacts of disrupted supply chains can take months to manifest at retail, so we still aren't sure when we'll see the full impact. In other words, if you know you're going to need a power supply in the next several months, it might be a good idea to do that shopping now.