Weak Dollar = Weak Wii Supply

Weak Dollar = Weak Wii Supply

by March 31, 2008

Europe Reaps Benefits; Shortage Expected to Subside

Live in the United States? Still can’t get a Wii? That’s because, in the eyes of the global economy, you are a second class citizen.

A Dallas Morning News article explores the various reasons Nintendo will not speak as to why they still can’t meet console demand, over a year on. The author, Victor Godinez, in speaking to Wedbush analyst Michael Patcher, says the weakening U.S. Economy and the shrinking value of the dollar may ultimately be to blame. It may be the reason Wii supply is keeping up across the Atlantic, according to the piece:

With a weak dollar, foreign companies that sell their goods in the U.S. for dollars and then convert those dollars to their native currencies get a smaller profit than if they sell their products in countries with strong currencies of their own (such as Europe with the Euro). In other words, Nintendo makes a bigger profit on Wiis sold in Europe than on Wiis sold in the U.S.

Current expectations are that, as the dollar regains its strength, Nintendo will shift the lion’s share of new console shipments back to North America.