November," Piper Jaffray analyst Gus Richard said in an interview Tuesday while discussing the shortage in the wake of the severe flooding in Thailand, where roughly half of the world's production of HDDs takes place.
"Availability is really going to tighten up. I'm seeing prices quoted anywhere from up 10 to up 60 percent," he said. And Richard said he is not focusing on retail but canvassing the world's largest PC makers to get a read on the supply situation. "We're calling up Apple, Dell, HP, Lenovo," he said.
The status quo can be deceiving, he said. "Nobody seems to be really paying attention. Everyone overreacted to the disaster in Japan. And now I think they're underreacting," he said.
Richards' comments echo a research note earlier in the week from Barclay's stating that global PC growth could fall in the fourth quarter to 4.3 percent from a previous forecast of 7.2 percent, largely due to the shortage.
There is demand of about 180 million drives for the fourth quarter but only 100 to 120 million will ship, according to Richard. "We could lose 5 to 10 million PC units in the fourth quarter," he said.
And the first quarter could get worse. Piper Jaffray spelled this out in a research note. "While it is difficult to calculate, we would estimate that limited drive availability will reduce PCs sales by 10-20M units over the next couple of quarters with 2.5M to 7.5M in demand destruction and 7.5M to 12.5M in deferred purchases."
The note goes on to say that "peak impact" of HDD availability will be in the first quarter. "Given the delivery shortfall in Q4, we would expect demand to be in the 230M - 210M range assuming no demand destruction or substitution. Thus, in Q1 there is likely to be a 60M to 80M unit shortage," according to the note.
A recent report from Taipei-based Digitimes claims HDD supply constraints may ease after motor supplier Nidec--which accounts for more than 70 percent of the global HDD motor market--resumes some production.
Richard disagrees. "It's not just the motors. It's the sliders, it's the Hutchinson suspension [assemblies], some of the head production. Half of all drives really do come from Thailand," he said.
And comments from Seagate, one of the world's largest suppliers of HDDs, doesn't paint a pretty picture either. "Given the supply disruption demand will significantly outstrip supply at least for the December 2011 quarter, and will likely continue for multiple quarters," the company said in a statement received today by CNET.
Consumers are beginning to react too, at least in Asia. Anecdotal reports from Japan point to hoarding. "Some people have rushed to stock up on HDDs, which has led to inventory shortages," Japan's Daily Yomiuri said in a report dated November 5.
