News & Opinion

AV Receiver Prices Set to Increase Following Fire

Last month, a factory burned down in Japan. With all that has gone on in 2020, that may not be the scariest statement you’ve read recently. But if you care about AV and home theater, it should worry you. Especially if you had plans for a new receiver in a year or two. Because AV receiver prices are set to increase. Possibly, they’ll go WAY up!

HDMI 2.1 has finally started making inroads into home theater gear. Currently, receivers from Denon and Marantz sport a single HDMI 2.1 input, and offerings from Yamaha have only three. When something as new and exciting as HDMI 2.1, and its promise of higher bitrates, hits the market, this is what manufacturers do. They try to get them into products as soon as possible. Even if their implementation is buggy and lackluster. All that matters to them is that AV receiver prices stay about the same. If that means fewer inputs because of cost, that’s fine.

What to Do if AV Receiver Prices to Increase

So, we’ve been saying this is a great year to skip buying a new AV receiver. Not because of the receiver prices, but because of HDMI. Wait until the manufacturers get their HDMI 2.1 ports on most if not all of the inputs and then buy. Getting a home theater receiver with only one input, or even three is a gamble. You run the risk of running out as you add to your system. Futureproofing an AV receiver isn’t easy, but this is a clear case for waiting.

And then the fire at the AKM Factory happened.

If you didn’t know (and honestly, why would you?), this one factory makes DAC (digital to analogue converters), ADC (analogue to digital converters), and many more chips that are used in home theater receivers and other pieces of AV gear. This isn’t just one factory that happens to make them, it is the ONLY factory that makes them. When this place went up in smoke (with, reportedly, no lives lost, thankfully), the ability to make these essential chips disappeared. This may lead AV receiver prices to increase across the board.

That’s going to be a problem going forward.

Manufacturers Dealing with Crisis

Most manufacturers buy in bulk (to save money of course), so they have stock on hand. AKM is looking to restore production as quickly as possible, but there is no clear plan on how to do that yet. Chips won’t be available for next year or maybe even 2022 AV receivers if the delay is too long. This will lead to massive price hikes (we are seeing $5 AKM chips being sold for $110 currently) or severe product shortages.

What’s It All Mean?

Currently, there is nothing to do but wait. Wait and see how fast AKM can restore production. Some estimates put it at 9 months. In the meantime, we’ll hope that AV receiver prices don’t skyrocket in the interim.

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