Buyers Go to Auction Sites for Scarce Palm Products

As Palm Inc. struggles to meet demand for its hand-held computers because of a shortage of components, impatient consumers are turning to auction sites such as EBay Inc. and paying well above retail price for new and slightly used units.

Bids for the low-end Palm IIIe, which has a $149 retail price, have topped $200 in recent weeks. The pricier Palm V has also been garnering bids above its $329 suggested price.

Shortages of LCD screens and other components are limiting Palm’s ability to increase production of the hand-held devices. Executives at Santa Clara, Calif.-based Palm say demand intensified because of Father’s Day and graduation season.

“We are making and shipping more than ever before, but we’re still not able to keep up with demand,” said Palm spokeswoman Marlene Somsak. “We do expect the component shortage to lighten up in the quarter we just began [June 1].”

Somsak said the company has received reports of people asking stores when the next shipment of Palms is arriving and then lining up to purchase them. Palms are also on back-order at many online stores, including Amazon.com Inc., Buy.com Inc. and Egghead.com Inc.

Kevin Homer, a regional sales director for JobDirect.com Inc., bid $230 on San Jose-based EBay’s site for a Palm IIIe and forked over an additional $12 for shipping.

“Convenience of ordering was a big factor, although I ended up paying more than I wanted,” Homer said via e-mail. “It’s kind of funny with a service like EBay--you can get swept away with the excitement of the bidding war when the clock is winding down.”

Douglas Moe, a production coordinator at a New York-based Internet company, said he paid above list price to get one of the special edition Palm IIIe units with a clear case.

“I paid about $188, where it would have been $150 if I could have found it in a store [or online] anywhere,” Moe said in a message.