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Nokia sees phone shortage due to Japan quake

Nokia sees phone shortage due to Japan quake
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First Published: Mon, Mar 21 2011. 08 05 PM IST
Updated: Mon, Mar 21 2011. 08 05 PM IST
Helsinki: Nokia, the world’s biggest mobile phone maker by volume, said it would have shortages of some of its phones as Japan’s earthquake has hit the supply chain, but the impact on earnings would be limited.
“Nokia expects some disruption to the ability ... to supply a number of products due to the currently anticipated industry-wide shortage of relevant components and raw materials sourced from Japan,” it said in a statement, adding that a complete picture of the situation was not available.
“Nokia does not expect any material impact on its Q1 2011 results due to this event,” the Finnish firm said, adding it would use alternative sources for components and production processes.
About 12% of Nokia’s components are sourced in yen, but Japanese components are likely to represent a larger share due to a recent renegotiation of supply contracts.
“Nokia is in a difficult enough position as it is. The sheer number of phones it sells means it is likely more vulnerable to unexpected disruptions to component supply than rivals,” said Ben Wood, head of research at CCS Insight.
“This is the last thing the company needs as it deals with the fall-out from the new strategy announced by Stephen Elop.”
Last month, Nokia’s new chief executive Elop unveiled a new software strategy for the struggling company, focusing on hardware and use of Microsoft software.
Nokia Siemens Networks (NSN), the telecom gear venture of Nokia and Siemens said it does not expect any immediate issues in its supply-chain due to Japan’s catastrophe as it sources only a small number of components from Japan.
Shares in Nokia were 0.9% higher at €5.93, off earlier highs.
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First Published: Mon, Mar 21 2011. 08 05 PM IST
More Topics: Nokia | Phone | Japan | Quake | Corporate News |