There has been a drought in the supply of lithium ion batteries required to power notebooks that has been squeezing supply of notebooks to the growing market. It should now be over in time for Christmas, according to one executive in the industry.
Laptop battery supply was constrained after a fire at South Korea’s LG Chem in March put the plant out of action as demand for notebooks has soared. This supply problem could however be over by the crucial third quarter of 2008, according to the head of the world’s largest independent notebook battery maker, Simplo Technology.
"The LG Chem problem has had a big impact on supplies, but we’re working with customers and they understand," said Sung Fu-hsang, chairman of Simplo. Companies such as Asus have been complaining that the notebook battery shortage has been hurting everyone in the market.
"I think maybe the battery shortage may hurt every brand," said J.T. Wang, chairman of Acer, at the company’s investor conference two weeks ago.
Asus claimed that it could have increased its target of shipping 5 million Eee PC’s by the end of the year had batteries been in better supply, though it is the smaller companies that have been suffering the worst effects as larger ones are generally cushioned by the lucrative deals that they have with suppliers.
Q3 will see the return to school and the Christmas run-in, and an increase in supply of notebook batteries – and, therefore, notebooks – couldn’t come at a better time.
