To avoid a labor shortage caused by the Lunar New Year holidays from impacting their shipments, notebook component suppliers have been building up their inventories recently with some suppliers already seeing their warehouses fully filled, according to sources from the upstream supply chain.

Since their clients have already promised that they will accept all the extra inventories, component makers have been aggressively manufacturing extra orders.

Some market watchers expect suppliers' shipments to remain strong in January, but the volume in February is expected to drop sharply and may need to digest their excessive inventories in March.

Since China's labor shortage is expected to reach the peak around the Lunar New Year holidays and many workers may not return to work after the holidays, brand vendors and ODMs are both concerned that the issue could seriously impact their product supply.

Since the Apple Watch is also set to be shipped in the first quarter, the sources expect wearable manufacturer Quanta Computer to offer better-than-average packages to attract available workers, causing labor shortage to become more serious.