Why the price of smartphones could explode

As we see a rise in prices on electronic products, Bloomberg reports that a major battery supplier, which works with Xiaomi and Oppo, among others, is announcing an increase in its prices.

Major manufacturers such as Oppo and Xiaomi will experience an increase in the prices of the batteries that equip their smartphones and other electronic products. Bad news for brands that could translate into higher prices for consumers.

Towards a general increase in the prices of our smartphones?

It is the main producer of Lithium Polymer in China, Ganfeng Lithium Co., which announces the bad news via a letter sent to its customers. We can read there that the company will have to raise its prices. Among its partners are two smartphone giants: Xiaomi and Oppo.

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Ganfeng Lithium Co. manufactures small batteries which are notably used in Bluetooth headsets. In its letter, the company does not hesitate to mention a “huge increase” prices of certain minerals such as cobalt oxide, lithium carbonate or even graphite. The materials used as the basis for the anodes would also have been affected by the electricity restrictions in Mongolia.

So many elements that are used in the production of batteries for electronic accessories, but also smartphones and electric cars. The latter play an important role in the shortage. Indeed, the demand for electric vehicles has exploded in recent months. Added to this is the general public’s enthusiasm for electronic products and the logistical problems linked to the Covid pandemic which have still not been resolved.

Prices that have already started to increase

It has not escaped your notice, some brands have already started to increase their prices to compensate for this increase in the cost of raw materials and the problems related to the supply chain. We will cite for example Sony who has revised the price of its PS5 upwards.

But the most glaring example remains the increase in the price of the iPhone 14 in Europe. The company has not been there with the back of the spoon on the old continent, but has been more lenient in the United States and China, two territories in which iPhone prices have not changed.

Recently, we also noticed an increase in the price to replace the battery of the iPhone 14. Apple gave no explanation for this increase. We will soon see if other manufacturers decide to pass on this increase in production and distribution costs to the general public.

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