PC Shipments Up as Manufacturers Scramble to Get Ahead of Tariffs | News & Opinion

651645 lenovo ideapad flex 14iwl - PC Shipments Up as Manufacturers Scramble to Get Ahead of Tariffs | News & Opinion

President Trump’s threat to impose tariffs on more Chinese imports has apparently caused the PC industry to stock up on inventory and deliver more products to store warehouses.

In the second quarter, PC shipments were up 4.7 percent year over year, reaching 64.9 million units, according to research firm IDC. The growth occurred as vendors such as Lenovo, Acer, and Apple deliberately shipped more products to avoid getting ensnared in the ongoing US-China trade war.

“The threat of increased tariffs led some PC makers to ship a surplus of desktops and notebooks, thereby artificially propping up the PC market during the second quarter,” IDC research manager Jitesh Ubrani said in a statement.

The US is currently imposing 25 percent tariffs on many Chinese-manufactured PC parts. But in May, Trump threatened to do the same for all remaining Chinese imports, including fully assembled PCs, smartphones, and video game consoles. Trump only decided to delay the action last month in favor for restarting trade negotiations with Beijing.

655413 idc q2 2019 pc shipments - PC Shipments Up as Manufacturers Scramble to Get Ahead of Tariffs | News & Opinion

Another factor behind the recent PC shipment increase was the easing of Intel’s chip supply shortage, which restricted some vendors from refilling existing inventory and pushing out new products. “Supply for Intel’s processors improved markedly during the quarter, allowing most PC vendors to fulfill old orders while also shipping a healthy supply of new PCs into the channels,” Ubrani added.

PC shipments were also up on businesses migrating to Windows 10. The older Windows 7 OS will lose official support in January 2020, so companies have been upgrading their office hardware, which has led to an increase in commercial PC demand over the last few quarters.

Rival research firm Gartner also reported PC shipments increases in the second quarter, but at 1.5 percent. “While the US-China trade war did not impact the PC market in the second quarter of 2019, the next phase of tariffs could have significant impact,” said Gartner analyst Mikako Kitagawa. “Most laptops and tablets are currently manufactured in China and sales of these devices in the US could face significant price increases if the punitive tariffs are imposed.”

According to both research firms, Lenovo ranked as the largest vendor for PC shipments during the second quarter, while HP came in second and Dell was ranked third.

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