Even before an earthquake and tsunami struck Japan, prices for car stereo products were on the rise. We know of four suppliers who raised prices this year and three others who are considering raising prices in 2011.
Component parts using rare earth metal like copper and aluminum have gone up in price by six percent or higher. Many car amplifiers use aluminum heat sinks, and may use copper and brass connectors. Speakers may use copper voice coils, aluminum baskets and neodymium magnets.
Rockford Fosgate addressed the issue by entering new higher price brackets for its 2011 lineup. JL Audio hiked prices slightly on some models as of March 1.
An amp and speaker supplier said his parts cost rose 6 to 8 percent late last year and he expects another 6 to 8 percent increase soon. “When you have for example a 6.5 inch pair of speakers that wholesale for $12.00, it’s hard to absorb,” he explained.
Currency fluctuations are adding to the pressure as the Japanese yen is down to around 79 from 90 earlier and the yuan is also lower. “If the Japanese Yen holds at 79, you can expect more increases,” said a major Japanese supplier, who, like others, preferred to speak anonymously on the subject.
On top of these dynamics, car stereo parts are expected to be shorter supply in Japan. A recent statement from Alpine explains that “a number” of its suppliers “appear to have suffered significant damage to their operations” from the earthquake. It added, “We will continue with our investigations, however some level of difficulty in procuring parts can be expected.”
Even those suppliers who refrain from raising prices this year are expected to introduce 2012 products at prices which may be 5 to 10 higher. This may have the beneficial effect of halting the usual price erosion on consumer electronics goods.