Thailand, the beautiful South Asian country known for its tourist attractions, has been devastated by a series of floods that have lasted more than three months. More than four hundred lives have been lost, and 2.3 million people have been affected. The financial impact is estimated to be in excess of 5.1 billion USD. Last month, some of Thailand’s biggest industrial estates including Nava Nakorn, Bang-Pa-in, Hi-Tech, Factory Land, Rojana, and Saha Rattana Nakorn were flooded. Among the companies impacted were Western Digital, Toshiba, and Seagate. So far, Seagate’s factories haven’t been directly affected; however, the Dublin based storage giant is suffering from component shortages.
Thailand is the world’s largest manufacturer of hard drives, and accounts for a quarter of the total worldwide production. After years of plummeting prices, the shortage of supply is already sending hard drive prices skywards. The prices of several of the hard drive models have already increased by more than 200%, and the situation will only get worse as we approach the holiday season.
The road to recovery is likely to be a slow and painful one. Digitimes expects hard drive shortages to reach 19 million units in Q4. Western Digital has temporarily suspended operations in Thailand, and will not be supplying hard drives to Taiwan channels in November. Samsung, another major vendor to be impacted, will also do the same, and instead ship shipments for manufacturing its own devices. The prices might start dropping within one or two quarters, but industry experts estimate that it will take nearly a year for normalcy to return.