The price of smart TVs is rising like an arrow, but the price increase of air conditioners is unexpected. Compared with LeTV’s first shot of Internet TV price increase, many manufacturers in the air-conditioning industry have issued "price increase orders"-at the end of 2016, Gree air-conditioning, Midea air-conditioning, Chigo air-conditioning, Hitachi household central air-conditioning, etc. successively sent distributors, The agent issued an official letter of price increase.
With the rise in raw material prices, logistics costs and labor costs, air-conditioning prices have ushered in an upward adjustment window. Wang Hongji, research manager of Zhongyikang's white power division, believes that because the prices of bulk raw materials are still bullish in 2017, it is expected that this round of price increases will continue into the first half of 2017. Especially after entering the peak sales season in March 2017, there will be a new round of prices in the entire air-conditioning market. Under the influence of multiple rising costs, the price increase of home appliances is irresistible, and the rising costs may trigger a new round of reshuffle of the home appliance industry.
market
Manufacturers successively increased ex-factory prices
Unlike smart TVs, which are still leading the way, the price increase of air conditioners has become a spark. Gree air-conditioning, Midea air-conditioning, Chigo air-conditioning, Hitachi household central air-conditioning, etc. have issued official letters of price increase to the majority of distributors and agents. On December 26, 2016, Midea air conditioners issued a price increase notice, and the price of an air conditioner will increase by 50-200 yuan. Another air-conditioning giant Gree announced after the end of the "Double Twelve" discount that the price of air-conditioners will increase by 50-100 yuan per unit from December 19, 2016. Chigo Air Conditioning announced in early December last year that the price of air conditioners will increase by 2% from December 2016 and another 2% in January 2017. Hitachi's household central air conditioner has decided to implement price adjustments on series products starting from January 1, 2017, with an average increase of more than 10%.
However, the end market has not yet reacted immediately. Yesterday, a reporter from the Japan Daily visited many local appliance stores and specialty stores in Guangzhou, including Suning and Gome, and found that the current major stores still focus on year-end promotions, and most products have not seen significant price increases. An air conditioner salesperson told reporters, “The ex-factory price has risen, but the previous inventory is still there. The impact of the price increase will not be reflected on the consumer side so quickly. The price increase may not be reflected so quickly. It is expected to be on New Year’s Day in 2017. There will be a substantial price increase in the aftermarket." The reporter saw on 58.com, Ganji.com, Zhuanzhuan and other platforms that air-conditioning prices were relatively stable compared to September last year, and there are still many promotional models.
The reporter learned that the current price increase methods of most mainstream air-conditioning companies are mainly reflected in raising the prices of new products. Data from Zhongyikang also showed that the most price-sensitive air-conditioning models were fixed-frequency and on-hook. In the week of early December 2016, the average price rose by nearly 100 yuan to 2,152 yuan from the beginning of November, an increase of 4.5%. In addition, there are more implicit measures to reduce marketing costs and increase product prices. The person in charge of the air-conditioning area of ​​a flagship home appliance store in the city said that some factories have already given verbal notices, and promotion resources will be significantly reduced.
Main cause
Commodity prices soared
Just like the price increase of smart TVs caused by the continuous increase in the price of LCD panels for half a year, the main reason for the price increase of this round of air-conditioning is also the helpless move after the sharp increase in the cost of upstream raw materials. “In the past, the price increase of air conditioners was mainly concentrated in the peak season, and the supply of goods was tight, which led to price increases. However, the price increase of air conditioners in December is indeed relatively rare." said Wang Hongji, research manager of Zhongyikang’s white power division, said this round of price increases. , The enterprise has to go up. "The price of raw materials has risen sharply. If the price is not increased, it will directly affect operating profits and even affect subsequent R&D and production."
The manufacture of an air conditioner requires a large amount of copper, steel plate, and plastic, which also causes the manufacturing cost of the air conditioner to be closely related to the price of bulk raw materials. The raw materials that have a great impact on household appliances are mainly steel, coal, copper, aluminum, plastics, etc., all of which have experienced substantial price increases in the past two months. Statistics show that compared with the situation at the beginning of 2016, the price of PVC has risen by 60%, the price of plastic has risen by 30%, the price of aluminum has risen by 30%, the price of iron has risen by 30%, and the price of cartons have risen by 30%, especially the highest daily increase in steel prices this year. Up to 300 yuan/ton, the cumulative increase has reached more than 200%. In addition, major materials such as compressors, motors, foams, and printed circuit boards also saw an increase of more than 20%. ABS plastic, the main raw material for the production of white goods shells, has soared for more than a month, while glass has risen to its highest level since 2011.
Among them, the cumulative price increase of steel products has reached more than 200%, which is particularly stressful for manufacturing companies. Because the steel consumption of the three major appliances, air conditioners, refrigerators, and washing machines, accounts for about 80% of the steel consumption of the entire appliance industry, the cost of raw materials for the three major products has risen accordingly.
Another important reason is that the inventory of air-conditioners was greatly digested last summer, and the inventory pressure of air-conditioning companies was greatly reduced. Since the second half of 2015, air-conditioning brands have launched a self-help plan. Most brands have reduced their production scale by as much as 30%-50%. After one year of production cuts and the sudden hot weather in the summer of 2016, the inventory of air conditioners dropped sharply.
According to Zhongyikang's calculations, as of the end of the cold year of 2016, there are only about 26 million air conditioners in inventory. Compared with the inventory of around 44 million sets during the peak period in 2015, the number of inventories was reduced by 18 million sets. Although the current industry inventory is still higher than the average in previous years, the threat that inventory poses to enterprises has been greatly eased.
Influence
Break free from price wars
The rise in raw material prices is not good news for the newly recovered air-conditioning market.
After the air-conditioning industry suffered the downturn in the past two years, the market is improving. Data shows that in October 2016, the production of domestic air-conditioners in my country was 8,307,900 units, a year-on-year increase of 59.4%. Among them, domestic shipments were 5.0593.9 million units, a year-on-year increase of 59%. Some people in the industry worry that product price increases may affect the recovery of the air-conditioning industry to a certain extent.
However, some people in the industry hold different views, believing that the price increase will have limited impact on the overall market. "This is a price correction in the air-conditioning industry. In the past two years, the air-conditioning industry has frequently engaged in price wars and the average product price has declined." Some industry sources said that the air-conditioning industry is entering the end of industrial restructuring. The demand may no longer be simple cooling and heating. For example, some intelligent functions and services such as early remote start, automatic timing detection, and early prediction of product failures will become new consumer needs.
Industry insiders also believe that because this type of price increase is not a single brand increase, it is believed that it will not affect consumers' buying behavior. "The price increase of air conditioners in the off-season will not have a big impact." He even believes that manufacturers can take advantage of this price increase to upgrade services and product functions to a new level and seize opportunities for transformation and upgrading.
The analysis report of Zhongyikang also pointed out that benefiting from the gradual decline in the price war atmosphere in the air-conditioning market, and the rapid upgrading of the structure of the air-conditioning market-the proportion of cabinets and high-efficiency products has increased significantly, equipped with intelligent functions such as voice recognition and infrared scanning. The standard configuration of high-end smart air conditioner. Zhongyikang judges that smart air conditioners will develop rapidly in the high-end market in the cold year of 2017, and the retail sales share of the on-hook market above 4,000 yuan will reach more than 25%.
Chen Yanan, an analyst at Zhuo Chuang Information, believes that price-setting policies are the only major factor directly related to corporate profits or profitability. Only reasonable prices can maximize the market and maximize corporate profits. "If you can't get sustained profitability and sustainable development, then the company will lack the stamina for development, so home appliance products can appropriately raise prices, but taking into account the reduction of capacity and competition factors, prices are unlikely to skyrocket."
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