Why are computer parts so expensive right now?
More importantly, what do you need to know about how to get computer parts without overpaying?
We’re going to discuss everything you need to know about PC hardware pricing right now, and when it might improve.
Why Are Computer Parts Expensive In General?
Even if there weren’t some unprecedented economic events going on at the time of writing, computer parts have always been made of some decently expensive components.
Even if you don’t have an especially premium PC, the materials and labor costs of modern CPUs and GPUs are still quite high.
While the raw material usage isn’t as high as with something like a car, you’re still paying for a great deal of Research, Development, and Manufacturing horsepower when you buy something like a Graphics Card.
Why Are Computer Parts So Expensive Right Now?
But the current pricing situation is extreme, even for computer hardware.
There are a few different major reasons for this, and I’ll list them below:
The Chip Shortage
So, the main reason that PC parts are abnormally expensive right now is that there has been a global chip shortage from 2020 to now. (December 2021 when this is being written, though the shortage is likely to continue into 2022.)
And like most disruptive events that happened in 2020, this one happened as a direct result of COVID-19.
Since the pandemic required many workers across the world to quarantine safely at home, the supply chain upon which PC hardware is reliant was greatly diminished.
Manufacturing a given PC component isn’t as simple as running a single factory for it: often, individual components for dozens of different products from dozens of different factories that are located in several countries across the globe are required to produce a single high-end PC.
Not only does this shortage of labor, logistics, and materials make hardware more expensive, but it also results in there being much less hardware to go around overall.
And since the pandemic resulted in people spending much, much more time indoors and working from home, this results in:
Incredibly High Demand
Besides the pandemic disrupting the supply chain and workflow that kept PC hardware on the market, it also created a much higher demand for hardware capable of keeping people entertained or in the workplace from home.
Another source of high demand has come in the increasing rise of cryptocurrencies like Ethereum, which are reliant on high-end graphics cards in order to “mine” the currency at profitable rates.
Even prior to the pandemic, this was becoming a problem in the PC hardware market, especially for professionals and PC gamers who needed the graphics horsepower these cards were originally meant to produce.
Ever since it became possible to use bots to buy up swaths of stock for immediate resell at inflated prices, scalpers have become something of a serious problem in consumer electronics.
Gamers have become particularly embattled against scalpers even outside of the PC space, where their treatment of consoles or limited run games and peripherals drew ire even before the chip shortage.
Since the chip shortage, we’ve been able to rely on scalpers to buy up all the stock of a given product before selling it at anywhere from 1.5x to, in extreme cases, up to 3x MSRP or more. Scalpers get the most success doing this with GPUs and gaming consoles.
If it can at all be avoided, don’t buy hardware from scalpers! Their business model relies on people being willing to pay their inflated prices, and the sooner they go out of business, the sooner we might start getting products at their proper MSRP again.
How The Chip Shortage Affects Different PC Parts
How The Chip Shortage Affects CPUs
The impact of the chip shortage on CPUs compared to GPUs is significantly lessened, but can still be fairly severe.
Fortunately, CPUs aren’t really made for mining crypto and a lot of users’ CPU needs are met without going particularly high-end.
Because of this, despite the shortages, it’s a lot easier to find a CPU being sold new at a reasonable price from a reputable storefront than it is with a graphics card or gaming console.
How The Chip Shortage Affects RAM
Well, most RAM is being manufactured using older processes, so the impact isn’t very severe…for now. You see, when I say “most RAM”, I’m referring to DDR4 and DDR3 RAM.
However, things are NOT looking good for the manufacturing and selling of the upcoming DDR5 RAM standard, and RAM was already fairly prone to price hikes before all of this.
Check out my Samsung B-Die Guide, which includes a selection of high-speed, low-latency DDR4 RAM kits if you’re due for an upgrade.
How The Chip Shortage Affects GPUs
Graphics cards are definitely the most severely impacted by the chip shortage.
As mentioned prior, they’re also experiencing some unprecedented levels of demand from the cryptocurrency community, which compounds on shortages to make them very difficult for consumers to get their hands on.
At the time of writing, mid-range or better graphics cards are being sold for extremely inflated prices, often 2-3x MSRP, even from reputable vendors.
There are some efforts to combat this by some companies. For instance, Nvidia brought back the RTX 2060 recently with a big upgrade to VRAM.
And since it’s using an older manufacturing process, in theory, it should be much easier to keep in stock at a reasonable price than newer graphics cards.
…in theory. Chances are high that bots are still going to snag them as they become available.
How The Chip Shortage Affects Gaming Consoles
Like graphics cards, gaming consoles are also severely impacted by the chip shortage, most namely Sony’s Playstation 5 and Microsoft’s Xbox Series S and Series X consoles.
These consoles are both built on AMD SoCs that utilize Third-Gen Ryzen CPUs and AMD Navi-based GPUs. Because these consoles are so closely tied to the same PC hardware supply chain for their core components, supplies are extremely limited.
While consoles are still generally sold at MSRP by retailers themselves, they’re quickly snatched off store shelves offline and online.
Once they’re on the scalper’s market, they’re often resold for 1.5x MSRP to 2.5x MSRP.
How The Chip Shortage Affects Smartphones and Tablets
Not very much, actually.
Most smart device manufacturers stockpiled what they would need to get through this shortage, but these supplies are beginning to dwindle.
According to this report from CNBC, this will most heavily impact smaller smart device manufacturers (like Lenovo), but prices across the industry are still likely to rise.
How The Chip Shortage Affects HDDs and SSDs
HDDs and SSDs are also affected by the chip shortage but to a much lesser extent.
There was a buzz about a storage-based cryptocurrency called Chia earlier in 2021, but fortunately for people who want to use their computer as a computer, it didn’t really take off.
Most storage is still easily available at its proper pricing, but that doesn’t mean storage manufacturers aren’t feeling the pressure.
The worst of the chip shortage, at least for SSDs, seems to have been back in 2020.
The chip shortage is still an ongoing situation, though, so don’t expect storage to stay at decent prices for too long, and definitely don’t be surprised if you notice high-end or enterprise-level storage being sold at much higher prices than MSRP.
Want to choose from a selection of great NVMe SSDs? Click here to check out my dedicated guide to the Best NVMe SSDs currently available.
How The Chip Shortage Affects Prebuilt PCs
While the chip shortage still impacts prebuilt PCs due to the hard limitations on supply, prebuilts are becoming surprisingly compelling in this era.
That’s because PC builders like NZXT or Alienware can directly buy the GPUs for their PCs at MSRP from manufacturers, resulting in some scenarios where buying a full PC with a high-end graphics card can cost about the same as the graphics card by itself, or for just a few hundred more.
How Can I Get Computer Parts Without Spending Too Much Money?
Let’s talk solutions. How can you get your hands on the hardware you want without selling a kidney to your neighborhood scalper?
Well, you have a few different options. One option worth considering, especially if you’re in the market for a console or a graphics card, is calling up your local brick-and-mortar stores (especially Best Buy if you’re in the US) to see when they’ll be restocking.
You won’t be the only person doing this, of course, but having an idea of what days you can walk into a store and be most likely to walk out with the product that you want can be fairly valuable.
Other options include following Twitter accounts and joining Discords like this Twitter account dedicated to monitoring GPU restocks.
There are many tools, pages, and even communities dedicated to monitoring when PC hardware is restocked and available and MSRP.
You can also do this part yourself by manually checking storefronts for what you’re looking for, but it’ll generally be a bit easier to find hardware with dedicated tools or groups to help you.
Want a dedicated round-up of recommended storefronts for PC Parts across the United States, India, the United Kingdom, Germany, Australia, and Canada? Check out Jerry’s detailed guide on Where To Buy PC Parts in your Country.
When Will The Chip Shortage End?
Finally, let’s address the elephant in the room: when does this end? When do things go back to normal?
While many people across the world are getting vaccinated and returning to their workplaces, the supply chain is still greatly damaged from the events of the past two years.
It isn’t just being felt in the PC and gaming spaces, either- many modern vehicles are also reliant on PC hardware to some extent, and shortages have driven up prices even higher.
So, will the chip shortage end soon? We can’t really say yet.
While the pandemic contributes greatly to the chip shortage, the shortage itself (as well as other impacts from the pandemic) is likely to be felt for quite a while after the pandemic ends.
That may not seem like a very optimistic view of the future, but I hope this article helped shed some light on what’s going on, why, and what you can really do about it.