Price Increase Notification

Transcription

1 Price Increase Notification t Oxidized Minerals (Rare Earth Elements), are an important component in the production of energy efficient fluorescent lamps. As a result of the escalating supply and increasing demand pressures for Rare Earth, prices for these obscure elements (China supplies > 95%) have risen dramatically within the last 12 months and continue to show signs of escalation into the future. All three major manufacturers have indicated they will continue to monitor the situation and they anticipate future price increases based on a growing demand for Rare Earth Elements. Industry Price Increases Effective Average 25%* August 1st, 2011 Average 25%* August 1st, 2011 Average 25%* August 15th, 2011 *The average increase for all fluorescent products is 25%. The actual price increase per fluorescent product could vary from 5% to >35%. Detailed pricing information will be communicated to our customers as it is made available by the manufacturers. *Contact your local lighting specialist for any additional details Specialists in Ligh ng Since

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4 July 8, 2011 Philips Lamps Customers: As a result of the Impact on Rare Earth Oxides and the extraordinary circumstances in the lighting industry, Philips must revise our previously announced September 1 st 10% average price increase for Linear Fluorescent Lamps (TL), Compact Fluorescent Integrated (CFLi) and Compact Fluorescent non-integrated (CFLni) to an overall average increase of 25% effective on August 15, Specific price increase percentages will vary by fluorescent product family. All other products will remain at current levels resulting from the previous price increase effective on May 16, Please note the August 15 th increase is over and above the increase effective on May 16, Orders will be accepted and shipped based on current price schedules and availability up until August 12 th, These orders shall not exceed 15% above the previous 90 day monthly average purchase history. The August 15, 2011 increase will be factored into stock, end-user pricing programs, and Special Pricing Authorizations (SPA s). Updated price schedules and price agreements will be available in an electronic format on or before August 5, As a world leader in lighting, Philips continues to lead the way in making improvements in the areas which remain within our control in terms of aggressively optimizing product designs which require REO s, reducing waste in the manufacturing process, recycling of various materials, as well as, numerous additional efforts intended to defray cost increases experienced from REO materials. Though these initiatives continue to deliver improvements, they are not enough to offset the ongoing and substantial cost impact resulting from the current global REO supply and escalating demand pressures. We plan to perform ongoing reviews and update our prices as required every 90 days commencing August 15, For more information concerning the REO situation, please contact your local Philips Lighting Account Manager or Agent. You will be alerted in advance should any supply issues result from REO availability. We thank you for your continuing support of Philips Lamp products. Very truly yours, Bill Tortora Vice President, Sales Professional Channel Ray Hurt Vice President, Sales OEM Channel Tel: (732) Certified to ISO

5 General Illumination Timothy J. Lesch Senior Vice President Sales, Service, Logistics NAFTA Executive Committee Member - OSI June 28, 2011 To OSRAM SYLVANIA customers: By now you may have seen the numerous articles and industry communications regarding how the scarcity of Rare Earth oxides combined with the hyper-inflation of prices, is having a serious adverse impact on the lighting industry. Since our May 23, 2011 price increase announcement, China has dramatically reduced the amount of rare earth oxides available for export and the cost continues to increase beyond our ability to compensate. The lighting industry consumes less than 10% of the Chinese export quota for these oxides, putting the lighting manufacturers at a competitive disadvantage as the supply of these materials shrinks. Even when it is possible to obtain the oxides, the costs have continued to skyrocket in recent weeks. Due to these continued cost increases, OSRAM SYLVANIA is revising our previously announced September 1 st 10% price increase on all Fluorescent Lamps to include Compact Fluorescent lamps to an overall average increase of 25% to be effective August 1, Actual price increases will vary by fluorescent product type. Please note that all other products will not be impacted by this increase. In addition, OSRAM SYLVANIA will be implementing increases on a monthly basis until the global rare earth oxide market has stabilized. Future price increase announcements will be posted to New pricing goes into effect for new orders on August 1, 2011 (11-2 book) and is over and above the July 1, 2011 (11-1 book) price increase previously announced. New price schedules will be available for download on We will continue to post announcements and detailed information regarding the Chinese rare earth situation to mysylvania. Our sales professionals will continue to provide you with our current pricing status and they also will notify you in advance of any availability issues. I appreciate your continued cooperation and understanding during this global shortage. Sincerely, Timothy J. Lesch OSRAM SYLVANIA, Inc N. Union Street Westfield, IN46074 United States

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