Quote: “The Age” www.theage.co.au
“Australians are among more than 15,000 tourists trapped on holiday islands after storms and floods hit southern Thailand, killing 21 people and destroying villages. Victims were either swept away by the rising waters, or buried in mudslides as the unseasonably wet weather deluged the homes and businesses of around a million people in what should be one of the hottest months of the year.”
Alas not a too unusual quote. Thailand’s worst floods in half a century have killed nearly 400 people since mid-July [Quote from Reuters] Thailand’s
capital; Bangkok, a city of 12 million people is on heightened alert because of threats on two fronts — a seasonal high tide this weekend that is expected to coincide with the arrival of a mass of water from the flood-stricken central plains.
This time, this tragedy, this disaster has effects rippling out around the globe and will affect us all. Many industries now rely on output from Thailand and, not surprisingly thecountries output has all-but ceased. The worlds electronic industry relies heavily on Thailand’s output.
- Apple Inc. CEO Tim Cook says he is “virtually certain there will be an overall industry shortage of disk drives.” Cook warns that Apple’s Mac
lines will be most affected.
- Seagate Technology PLC, (Hard Drives), says its factories in Thailand have been operational, but it may have difficulty making
hard drives because of constraints in getting parts.
- Western Digital Corp, (Hard Drives) says flooding damage to its Thailand locations will have a significant impact on its operations and its ability to meet customer demand the rest of the year.
- Emulex Corp. (Data Storage) says a subcontracted manufacturing facility has suspended operations due to flooding.
- Fabrinet, (parts for optical, electro-mechanical and electronic manufacturing companies), says it expects its plants to remain closed through the rest of the quarter.
- Emcore Corp, (semiconductor-based components), says flooding penetrated a contractor’s production facility over the weekend, submerging some equipment and it’s ramping up production in China and other areas.
In an update recently, Toshiba said that water is two meters high on the site and the surrounding area, and more than one meter deep in the buildings at its hard disk facility. The company started alternative production at other factories, but said “the production volume will be limited by available capacity”.
It seems that Hard Drive supplies have been very hard hit, it’s said shipments in the fourth quarter will decline to 125 million units, down 27.7 percent from 173 million in the third quarter. The result in this significant shortage of HDDs is going to mean only one thing, an increase in price of about 10 percent compared to third quarter prices.
The HDD plants affected by the flooding make devices designed for mobile computers, but disruption to notebook shipments in 2011 is not expected, as the PC industry appears to have sufficient stockpiles to last through the fourth quarter. With HDD production disruptions expected to last at least six months, the shortage could impact notebook PC production in the first quarter of 2012.
The floods in Thailand may also cost Western Digital its top position in the HDD market. In the quarter to July 1, Western Digital shipped about 54 million hard drives from its facilities in Thailand and Malaysia, with about 60 percent coming from its sites in Thailand.Given the direct impact of the disaster on its operations, Western Digital is likely to lose its status as the world’s largest shipper of HDDs, with its rank expected to fall to third in the fourth quarter.

The floods will also have ongoing effects on the Thai camera manufacturing operations of Sony, Nikon and Canon. The supply issues are anticipated to mean a drop in overall camera shipments in the fourth quarter and possibly in the first quarter of 2012. Sony said last month that it was forced to postpone the launch of its new “NEX-7″ high-end portable digital camera and cut production of another because a factory in Thailand was affected by the flooding.
With floodwaters edging closer to the door-ways of Bangkok, the political and human costs of the country’s worst floods in over five decades are fast becoming evident. Over here in the west we all could do well to cast an eye towards Thailand and help in any way we can. This Asian disaster is our disaster too. Thailand’s economy supports all our economies and the high water hell they are suffering now, could become our economic hell very soon.
Our thoughts are with the people of Thailand
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