Thai floods to tighten Dell's hard-disk supplies

PC maker expects its hard-disk drives to be limited over next few weeks due to Thai floods, report reveals, while analysts note that shortage may extend into next year.
Written by Ellyne Phneah, Contributor

Dell has announced that flooding in Thailand is likely to tighten supplies of hard-disk drives used in its computers, according to a report Friday.

In an e-mail interview with Agence France Presse (AFP), Dell said it was actively monitoring Thailand's flooding situation. The PC maker noted that while hard-disk drive (HDD) supply was expected to be limited over the next few weeks, it was working closely with their HDD suppliers to mitigate any customer impact.

"We have teams engaging daily with affected suppliers regarding this industry situation, in order to most effectively and efficiently manage our HDD supply chain," Dell said.

According to IDC, PC makers could be hit hard by early next year due to Thailand's flooding disaster which had now stretched over two months. The floods shut down several HDD factories in the Asian country, which supplies about 45 percent of the world's HDD market in the first half of 2011.

In worst-case scenarios, the plant closures could force a 20 percent cut in PC shipments in the first quarter next year. "Even the largest vendors are expected to face HDD shortages, particularly for portable PCs where the market is more consolidated," said Loren Loverde, program vice president of IDC's worldwide PC tracker program.

Research firm IHS iSuppli added in a statement that the floods would cut global HDD shipments by some 51 million units, in the current quarter, to 125 million units. "Prices for HDDs have already begun to move higher on the anticipation of shortages, and it is likely that prices will remain elevated, possibly by more than 10 percent for several quarters to come," IHS said.

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