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Technology will keep getting more expensive in Spain, we’ll tell you why

  • September 12, 2022
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iPhone 14 price she did not grow up in the United States, but in Spainand the same has happened with other technological products in which consumers are very

Technology will keep getting more expensive in Spain, we’ll tell you why

iPhone 14 price she did not grow up in the United States, but in Spainand the same has happened with other technological products in which consumers are very interested, such as the PS5, a console whose price has increased from 499.99 euros to 549.99 euros, and that will soon be two years old. it would be normal if its price started to fall. In the United States, the price of the PS5 did not increase either.

These two movements have a very simple explanation, very easy to understand, why it is summed up around a concept that will be clear to many of you by now, the value of the euro against the dollar. The beginning of the Ukrainian war caused considerable uncertainty at the international level which profoundly affected society and the economy and sowed the ideal fertile ground for the dollar to reach parity with the euro.

That equality hurts us, and a lot. The loss of value of the euro against the dollar makes imports more expensiveand it also has a huge impact on the cost of materials, since the dollar is the reference currency in this regard. To understand why they harm us, we could give many examples, but really two are enough.

When the euro was worth $1.2, we could import products 20% cheaper compared to the current euro-dollar parity. Also consider what this parity means for price conversion and tax application. For example, the iPhone 14 Pro costs $999 in the United States, if we convert the price to Euros and apply taxes, we see that:

  • With conversion 1.2 dollars per euro the price without tax would be €799.2. Applying taxes (21% VAT) would increase this figure 967 euros.
  • With a parity conversion (1-1), the price of the iPhone 14 Pro would be before tax €999 in Spain. By applying 21% VAT, we would have costs of 1,208.9 euros.

dollar euro change

It’s true that Apple rounded the price upand that in the end the final cost of the iPhone 14 Pro was higher than what we would have obtained by directly calculating and applying taxes, but this does not change the main reason What is behind this increase?

While some tech giants such as Microsoft and Nintendo have assured that they do not plan to raise the prices of their products “for now”, this does not mean that price increases cannot be produced in the short or medium term. On the other hand, numerous rumors suggest that other major releases from Intel, AMD, NVIDIA and Samsung, among others, they will have a higher price not only in Spain, but also in the entire eurozoneand the main culprit will be this parity between the dollar and the euro.

It may happen that in some cases the big ones decide fully or partially absorb the impact of this euro-dollar parityand that it allows us to keep prices closer to what we are used to, but in any case this It will be the exception and not the rule.

Obviously other things also affect the price of technologysuch as shortage of certain materials and consequent increasing the price of these, but in the end what hurts us the most when we talk about general consumer electronics is the parity between the euro and the dollar. Will this situation last forever? No, apparently not, once this economic uncertainty begins to dissipate and the waters return to normal, we can expect a slow recovery at all levels, including technology prices.

Source: Muy Computer

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