When the UK decided to leave the EU the stock markets reacted. Now, more lasting effects are being seen in other industries and in other countries. The US computer maker Dell and Chinese smartphone company OnePlus are both raising prices because of Brexit. Other companies are also considering raising prices to deal with the repercussions of this decision. Dell declined to give any specific product price changes however, the Register reported that they had implemented a 10% increase to all products in the UK.
When asked they stated “In line with the rest of the industry, our component costs are priced in US dollars, and unfortunately, the recent strengthening of the US dollar versus sterling and other currencies in the EMEA [Europe, Middle East and Africa] region, following the UK’s decision to leave the European Union, will have a direct impact on the price we sell to our UK customers and partners”. With the Brexit decision, many industries are in defensive mode. With the decision comes a lot of uncertainty about how the economy will be affected. The Brexit vote caused the pound to hit a 31-year low against the dollar. Since then it has dropped more than 12% in the following weeks. The falls against Asian currencies have been even worse.
Companies are even bracing for high turnover and lowered sales as a result of the decision. The cellular company OnePlus stated that it may be six to nine months before they can stabilize their prices. They even acknowledged that they would have higher turnover as a result, but they had no other options. OnePlus even had a small buffer that was supposed to help with minor price fluctuation but the result of the vote was too great to be absorbed.
Brexit has had a major impact on the UK and now it effects are reaching other countries. Many tech companies are expecting inflation within the tech market so they are preparing accordingly. Over the next few years it will be interesting to see all of the repercussions of this decision and whether it will hurt the economy. Tech companies will have to find a way to keep prices low in order to keep sales steady. These products will also cause price hikes in a number of other products.