Thailand Floods in Bangkok have disrupted the technology supply chain, forcing more than 200 factories to close.
With around 25% of hard disk manufacturing now offline the future looks bleak as prices begin to rocket!
Since July Thailand has been devastated by monsoon rains resulting in widespread floods throughout the country, with an estimated 360 people dead. The floods are now escalating into the north of Thailand with a further seven districts now at risk.
Because of extensive flood damage, many factories have been forced to freeze sales, with Western digital recently stating that it could between five to eight months to restore productivity and bring plants back online.
Thailand is the second largest exporter of hard drive disks in the world, after China. This colossal loss in production has led to product shortages for businesses around the world. As hardware companies struggle to fulfil their orders products are becoming increasingly hard to find, with prices reflecting this increasing rarity. This, in turn, is costing businesses millions.
In a recent statement Western digital expressed their concern publically stating that:
“The Company now expects that the flooding of its Thailand facilities, combined with flood damage to the company’s supply chain in Thailand, will have significant impact on the company’s overall operations and its ability to meet customer demand.”
Major distribution Company Computer 2000 has also been forced to place disk drives on manual allocation in an attempt to measure and distribute supplies among its customers. With the second largest hard drive manufacturer Seagate stating that hard drive supplies will be constrained throughout the current quarter. In addition to the increasing prices of hardware due to a lack of availability, panic buying is also forcing hardware prices to rise further with the shortage expected to continue into 2012.
Richard May, managing director of Cloud Computing company virtualDCS said “Natural disasters such as this are becoming increasingly common and with many companies dependent on purchasing hardware facilities their business productivity has now come under threat. This is one of the many reasons that more companies are using Infrastructure as a Service. Through Cloud technology hard drive space is readily available for use and flexible to the requirements of any company, where they can upgrade or downgrade data storage whenever they need to with no capital outlay.”