08 December 2004 PC maker Dell’s European customers are missing out on price cuts of up to a fifth, which are being offered to corporate buyers in the US, despite the increasing globalisation of the PC market.

In the wake of declining component prices Dell has slashed the costs of some of its servers, workstations, PCs and flat-panel displays by as much as a fifth for US businesses. But European customers will have to wait for similar discounts Dell has confirmed.

Dell’s entire business model is predicated on building hugely efficient supply chains, and delivering the savings to customers. But the decision not to pass on savings to European customers immediately, show it is facing hurdles in an increasingly global PC market.

The deal that sees IBM sell off its PC business to Lenovo could be bad news for Dell. Dell has established a clear lead in the PC market through its aggressive pricing policies. But notably, it has struggled to establish dominance in the Asian markets, where local players, such as Lenovo, are able to compete on price.

The IBM deal will give Lenovo a global presence, and increase the pressure on Dell to adopt a global pricing policy.

A spokesman for Dell said: Price savings are something we continue to look at and we pass them on to the [European] customer as soon as we’re able to.”