IT Industry Leaders Brace For Potential Product Shortages


Top information technology (IT) industry executives, including the CEO of the world's largest IT product distributor, say they are bracing for potential product shortages as a result of the tragic Japanese earthquake and tsunami.

"There are a number of potential product delays and shortages in front of us," said Greg Spierkel, the CEO of Ingram Micro, in an interview at the HP Americas Partner conference in Las Vegas. "We don’t know how much, but I think there is going to be some impact. We just don't know exactly what finished products are going to be affected."

Ingram Micro is in daily contact with its key vendors to figure out what’s going to happen, and when. Spierkel said the prevailing view is that the effects will be felt from mid-April through September. "It could be two quarters until you reseed some additional production of components into another country or location," he said.

Spierkel said there have been no concrete details on what products might be impacted. "There may be some winners and losers depending on where their supply chain was but we don't know the exact likelihood of that yet," he said.

Japan, a major source of the components used in a wide range of IT products, on March 10 suffered a massive 9.0 earthquake off its eastern coast followed by a tsunami which combined to cause thousands of deaths and triggered a nuclear power plant disaster.

Several Japanese IT factories were either directly damaged by the earthquake and tsunami or were purposely shut down as a result of power outages, and even as they restart production will need time to return to normal.

A certain part of the production of materials that go into components like NAND memory, used in the production of SSDs and hard drives, come from factories in the part of Japan that was hit by the earthquake and tsunami.

Todd Bradley, executive vice president of HP’s Personal Systems Group, a $41 billion business that includes a wide array of consumer and commercial IT products including PCs, smartphones, tablets and monitors, said there is still a "lot of assessment" going on with regard to the exact impact of the Japanese earthquake on the supply chain.

Next:The HP Supply Chain Impact