Western Digital’s Thailand production shutdown due to monsoon flooding

Massive floods in Thailand have taken a toll on the technology producing niche in Southeast Asia. The worst of all is the shutdown of Western Digital’s Thailand plant. The company specializes in storage hard drives manufacturing and are a major vendor for
computer corporations like AsusTek, Apple and Dell.

WD produces almost half of the hard drives in the world and the Thai plant makes almost half of that volume. The speculated shortage in the production and inventory is expected to fall in the neighbourhood of 25 to 30 percent.

They are major vendors for top flight companies like Hewlett Packard, Dell, IBM’s Lenovo and Apple. Due to a relatively small market share, Apple will be affected at the least but they have new lines of notebooks and desktops in queue therefore, might take
them on strike one.

The disaster will keep the WD unit closed for at least 15 days and there is need of massive cleanup required afterwards for hygienic purposes. Needless to say, a complete overhaul of the machinery is also required. Water corrosion might result in a need
of replacement of components.

There is an approximately 50-million-unit demand per month globally and as much will be short for shipment in the next 3 to 4 months until the production unit comes back to full strength.

In addition to WD, hard drive component producers like the spindle manufacturers also have had their fair share of the ordeal.

There have been natural calamities in the past like last year’s Japan earthquake and 2009 Tsunami but businesses managed to elude all these adversaries.

There are a number of contenders in the market to take up the gauntlet and pool in their share to overcome the shortage of electronic components. However, these organizations are not capable of producing en masse.

Moreover, the Solid State Drives are being considered as a replacement to the magnetic hard drives but there are two factors that do not favour this solution; one, their prices are higher in a clear contrast and secondly, they are not produced on a larger
scale.

However, if all the aforementioned companies pledge their efforts collectively in this time of dire need, the shortage can be overcome.

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Posted by Usman Khalid on Nov 19 2011. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry