I don’t know if you have been following the news lately, but the monsoonal flooding in Thailand has reached epic proportions and has had a disastrous effect on the availability of hard drives worldwide. According to the IDG News Service, a number of electronics companies have halted production in Thailand, including Nidec which according to iSuppli supplies more than 70 percent of all global HDD motors, and is a supplier to major HDD manufacturers like Western Digital, Seagate, Hitachi Global Storage Technologies, Toshiba and Samsung. Please refer to the attached link for one more story about this problem:
Reuters.com - Thai floods, hard drive shortage threaten PC sales - http://www.reuters.com/article/email/idUSTRE79K76Z20111021
The plants at Western Digital have been impacted the most, with reports of a 60% reduction in available product for this quarter. This has obviously impacted WD's competitors as well as the simple laws of supply & demand has taken hold immediately. Our hard drive costs have gone up about 40% in a week and this will have an immediate impact on our pricing to our partners and customers. Large OEM accounts like HP, Dell and Lenovo will be impacted very soon, since virtually all systems need hard disk drives.
This means that it will be advantageous for you to take a thoughtful look at your requirements for this quarter and secure them with a purchase order so that we can secure the inventory at the best price possible. Based on your input, we will put in a written quotation for product and our best estimate of shipping times to meet your needs based on receiving a purchase order for product.
Thank you for your loyalty and partnership during these difficult and trying times.