Thailand has experienced its worst floods in more than 50 years, potentially leading to a shortage of HDD supplies during the current quarter that may last into the first quarter of 2012, according to IHS iSuppli.
Thailand is the world's second largest exporter of HDDs behind China. A total of 25% of worldwide HDD assembly facilities are located in the country, IHS indicated.
Western Digital (WD) and Toshiba have temporarily halted production of HDDs in Thailand, impacting a major portion of global hard drive manufacturing. The companies operate HDD assembly facilities in Pathum Thani province near Bangkok.
WDC, the world's largest HDD manufacturer in terms of volume, has 37,000 workers in Thailand, and production in the country accounts for 60% of the company's total capacity.
Toshiba employs about 3,900 workers in Thailand, and approximately 50% of the company's manufacturing capacity is in the country.
No. 2 HDD supplier Seagate has a head stack and head gimbal assembly (HGA) facility in Teparuk, Thailand. The company also conducts slider, head assembly and HGA operations in Korat, Thailand. However, both facilities have remained operational following the disaster.
In addition, the floods may have affected operations for the supplier of a key HDD component - the motor, IHS observed. Nidec supplies more than 70% of all global HDD motors, and all the major HDD manufacturers - including WDC, Seagate, Hitachi GST, Toshiba and Samsung - source motors from the company. Nidec has two subsidiaries in the country: Nidec Electronics and Nidec Precision, both located in Ayutthaya, northwest Thailand.
HDD suspension assembly maker Hutchinson Technology also temporarily suspended operations at its facilities in Ayutthaya due to the flooding and a loss of power. Hutchins said it plans to increase production output at its US assembly operations and will use existing inventory to meet customer demand.
The current IHS HDD forecast, developed before the disaster, calls for production of 176.2 million HDDs during the fourth quarter, representing 25.9% of annual manufacturing in 2011. IHS likely will downgrade its fourth-quarter production forecast in light of the impact of the disaster.
Source:digitimes