Vendors consolidate after Japan catastrophe


Sony Ericsson and Nokia say shortages to memory chip and semiconductor production will disrupt parts of product supply chains

Sony Ericsson and Nokia expect disruption to parts of their supply chain, due to the Japan earthquake.

Japan manufactures memory chips and semiconductors for smartphones.

Panic buying from phone manufacturers is expected.

Prices have already increased as a result of the shortage.

Last week, Nokia said it expects “some disruption” to supply for some products, due to the “anticipated” industry-wide shortage of components and raw materials from Japan. It did not expect first-quarter sales to be affected.

Nokia executive vice president of markets Niklas Savander (pictured) said Nokia was in talks with suppliers in and outside Japan to ensure components could be sourced.

Savander said: “Nokia’s supply chain management system is designed to mitigate operational disruptions. We use alternative sources for components and production processors.”

Sony has ceased operations in five of its sites in Japan because of the earthquake, halting production of Sony Ericsson handsets, camcorders, headphones and televisions.

Sony Ericsson’s 1,100 staff in Tokyo are all unharmed and there has been minimal damage to Sony buildings.

The global giant is seeking alternative component supply for its products.

Sony Ericsson said: “We are in contact with all our key suppliers in the region and are identifying relocation of certain components for manufacturing, and secondary sources of supply.”

HTC’s CEO Peter Chou said HTC supply chains were “operating as normal”. Samsung reported it would monitor the situation in Japan and remain in “close consultation” with clients and suppliers.

Supplies of the new iPad 2, which uses Japanese components, will not be affected. Scheduled launch in to 25 countries last Friday proceeded without disruption.

Apple said it will delay the Japan launch of the iPad 2 indefinitely whilst the country recovers.

UK distributors Data Select, 20:20 and Brightstar have not received warning of stock shortages at time of writing.

They did not anticipate problems in the short term.

Vodafone and O2 were monitoring the situation regarding handset deliveries and said a full assessment would be completed in the coming weeks.