Amazon is seemingly preparing to manufacture an 8.9in version of the Kindle Fire, according to sources in the company's supply chain.

Digitimes reports that the second-generation Kindle Fire will have an 8.9in screen rather than a 10.1in screen, as Amazon had originally planned. The first-generation Kindle Fire, which is not even on sale yet, has a 7in display.

First Look: Amazon Kindle Fire

According to the report, panel suppliers Chunghwa Picture Tubes and LG Display have begun to prepare production capacities for 8.9in displays. However, there may be even larger models - between 9.7in and 10.1in - coming at some stage in 2012, possibly as part of a third wave.

Reports that Amazon was planning to develop a larger tablet, possibly manufactured by Foxconn, have been circulating since August - before Amazon had even officially announced the 7in Kindle Fire.

The Kindle Fire goes on sale in the US on 21 November costing $199 (around £125). International availability hasn't been announced yet but it is likely to make a significant impact on the tablet market given its low price tag.

Amazon said last month that demand for the Kindle Fire had been so high that it had ramped up production of the device.