We all know that the price of gas has increased exponentially for the last several months. Here in the Tampa Bay area, the average price per gallon is around $4.00. It now costs me about $60 to fill up my wife’s Honda Accord. In a word: damn.
Now, my wife and I are lucky in that we don’t commute. My wife is at home taking care of the little one and I work from home. But, for those who do drive to and from work, the gas prices have to hurt.
This last weekend, I had somebody pose the possibility that the gas prices could drive up costs for computers. Is that a possibility?
To understand my viewpoint on this, let’s look at basic economics. Price increases as demand increases. Also, as cost of production goes up, so does the price of the retail.
On the latter point, gas prices can certainly have an impact on the price of technology. Transportation costs are increasing which means cost of shipments will increase. If it costs more for the manufacturer to move things around, it could very well carry over to the final cost of hardware.
On the flip side, the higher cost of transportation is likely to increase the reliance on things like the computer and the Internet. People may start telecommuting more. People may be more apt to purchase things online rather than drive to the store.
So, while we may see some carry over cost to the final cost of our hardware, demand is surely not going to change. In fact, demand for technology is only going to increase faster. These two effects will balance each other out.
There is a lot at play in the economy right now. However, I believe that technology is poised to weather it out very well.
What do you think?
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The way I see it, the cost of ANYTHING that needs to be transported has the possibility of increasing in price.
Food prices are already on the increase in Tampa (been doing cost comparisons with Publix and Sweetbay the last month or two) and working in the retail/technology industry I’m watching pricing on various products to see how they go.
I’m guessing that yes, gas prices will affect pricing on technology items.