After PS5 Price Hike, Will Xbox And Switch Raise Prices Too?

gamespot.com:

Sony made the unexpected announcement on Thursday that it would raise PlayStation 5 prices, effectively immediately, in Europe, the UK, Canada, Australia, China, and other markets around the world. In aggregate, the PS5 is becoming about 10% more expensive in about 45 markets outside of the US, which is seeing no price adjustments. In light of the PS5 price hike, should we expect Nintendo and Microsoft–which are facing similar pricing pressures–to raise prices, too?

Starting with Sony's PS5 price hike, the move shocked some, but it wasn't totally unexpected. At the end of July, as part of Sony's latest earnings briefing, the companydid not rule out a PS5 price hike, leading some to speculate that it would only be a matter of time before Sony raised prices. Adding to the credibility of the speculation was the fact that Sony also raised prices for headphones, speakers, and cameras earlier this year (in Japan, at least).

Console prices historically come down over time as component prices fall and logistical factors are streamlined. Things are different in 2022, however, due to supply chain issues, component costs, and shipping problems. Piers Harding-Rolls of Ampere Analysis said in a note that inflation and general component price increases in the supply chain, along with distribution costs that remain high, have all contributed to the PS5 price increase.

Sony could eat these costs or pass them along to the consumer. It chose the latter. «Sony has now had to pass on some of those cost increases to try to maintain its hardware profitability targets,» Harding-Rolls said.

The selling price of the PS5 is not going up in the US, which is the world's biggest market for consoles, due to the ongoing strength of the US dollar