[Buzz_Dengue]

HP Upstream Suppliers Suffered from Piled up TouchPad Components
Yenting Chen, Taipei; Joseph Tsai, DIGITIMES [Tuesday 30 August 2011]

As first-tier PC brand vendor Hewlett-Packard (HP) has recently halted all its TouchPad projects, upstream suppliers are currently suffering from the component inventory, which is prepared for the production of the upcoming TouchPad including the 7-inch model, according to sources from upstream component players.

The suppliers are currently in negotiation with HP to find a solution for the component inventory, while HP Taiwan pointed out will maintain its promise to the partners. However, HP's contact windows with upstream suppliers in Taiwan is also said to still have not yet received any notification from the headquarters, the sources added.

The sources pointed out that the inventory level is capable of producing about 100,000 7-inch TouchPads and was originally set to start production at the end of the third quarter, but HP's sudden change of strategy has completely messed up upstream player's schedules.

Taiwan-based PC maker Inventec, the manufacturer of HP's tablet PC, declined to comment about HP halting its production of its tablet PC and only pointed out that its relationship with HP remains as the same as usual. In addition to tablets, Inventec is also a manufacturer of HP's server and enterprise notebooks.

The sources also pointed out that even if HP is willing to absorb all the related component cost, suppliers' unseen losses during the time are still hard to calculate.

HP upstream suppliers suffered from piled up TouchPad components

[Buzz_Dengue]

This is a procurement/logistics nightmare... likely this last production run is the least cost way to dispose of "obsolete" inventory in HP's calculations. Not fun stuff...