IT and smartphone parts shortages start to pinch

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IT and smartphone parts shortages start to pinch

Prices rise up to 30%, production delayed
Published: 6/04/2011 at 12:00 AM
Bangkok Post: Newspaper section: Business
 
Local notebook computer and mobile phone producers are starting to feel the pinch of parts shortages and shipment delays resulting from Japan's earthquake. The result has been higher prices for some components, say IT vendors.

Manufacturers of hard-disk drives, meanwhile, say electricity shortages in Japan are also affecting the production of some of the components they need.

Production of three new models in the Xperia handset line has been directly affected by supply problems in Japan, said Ittipol Pantupongse, product group manager of Sony Ericsson Thailand.

Mr Ittipol said the company had to postpone the introduction of the Xperia Arc and Neo models in Thailand to the third quarter of this year from its earlier plan this month.

The company has asked its local distributors, TG Fone and Synnex, to refund deposits to an estimated 500 customers who had pre-ordered the phones online.

Mr Ittipol said the company had hoped to use the two models as flagship products to improve its market share this year.

Nokia also expects some disruptions because of an industry-wide shortage of certain components and raw materials sourced from Japan. However, it does not expect any material impact on its first-quarter results.

Vira Intanate, the CEO of the IT product distributor SVOA Plc, said prices of some components such as DRAM memory used mainly in personal computers and notebooks, had risen by 20-30% this month. Prices for some hard disk parts are up 5%.

Notebook batteries are also likely to be in short supply in the near future, added Mr Vira.

Somchai Sittichaisrichart, managing director of SiS Distribution (Thailand), said the prices of flash memory for USB flash drives and SD cards in mobile phones and cameras had increased by 10-20% since the disaster in Japan.

"If production disruptions continue, prices of products that need parts from Japan are likely to increase in the next three months," he said.

An executive with a hard-disk drive (HDD) manufacturer in Thailand said that about 130 electronic parts makers that supply the industry had been affected by rolling blackouts that curbed production in Japan. "Inadequate power supply, in particular, results in manufacturers being unable to run the plants smoothly," he said.

Toshiba, the world's leading supplier of diodes for integrated circuits, has reported damage at its major plants, resulting in declining supplies of materials. "I think this is a normal demand-supply situation. Once the supply is affected and falls short of the demand, it may cause the prices to rise," said the executive.

Sampan Silapanad, president of the Electronics and Computer Employers' Association, said chip and integrated circuit (IC) makers were being hit hard due to the shortages of raw material and components.

"These manufacturers have had to develop a second source of raw materials and components. This has unavoidably resulted in higher expense," he said.

Nonetheless, the association has yet to see enough evidence to clearly indicate that component prices have increased substantially, added Mr Sampan.