Asian Crisis Enables Dell to Cut PC Prices

The currency crisis in Asia is already leading to lower computer prices in the United States, as Dell Computer Corp. said that falling component costs enabled it to slash prices on its top-selling line of PCs by about 15%.

Dell’s cuts reflect what the company said have been unexpectedly swift declines in prices the company pays for Asian manufactured components, including memory, CD-ROM drives and video cards. Asian currencies have plummeted relative to the dollar in recent months, meaning U.S. companies and consumers have greater buying power when purchasing goods produced in Asia. Dell officials said the discounts have been greater than the company expected. “If the situation persists, there’s certainly the potential for additional [cuts],” said T.R. Reid, a spokesman for Dell, a fast-growing computer company based in Round Rock, Texas.

Analysts said falling prices on components are just one of many forces bringing down computer prices. Intel Corp., for example, recently discounted its Pentium II processor, one of the most expensive components of a PC.

But analysts warned that consumers should not expect the Asia crisis alone to usher in a new era of PC bargains, because the components involved are not that costly to begin with. The items that Dell mentioned, for example, typically cost less than $200 combined.

Dell’s price reductions apply to its OptiPlex PC line, the machines it markets to large corporations and government agencies that make up about 60% of Dell’s business. These high-performance PCs now cost $2,338, compared with $2,746.

The company said it is also cutting prices on certain workstations.

Dell shares fell 6 cents to close at $86.19 on Nasdaq.