Sunday, November 20, 2011

Hard Drive Shortage Looms Due to Flooding in Thailand

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While many of you may have read about the flooding in the Pacific rim, it turns out this terrible weather situation will also have an effect on other parts of the world.  Now don't get me wrong... I've seen pictures of the devastation and my prayers are with those who are affected by it.  In May of this year, Joplin, Missouri was struck by a massive killer tornado that decimated a huge chunk of the town and many of my friends were affected by it (Joplin isn't too far south of where I live & practice).  I can't begin to understand the situations, pain, shock, and all of the other things that people involved in tragedies of this magnitude must go through.
Now, in addition to everything else that the flooding has caused, comes word that the manufacturing sector of Taiwan's economy has also taken a hit due to the devastation.
It turns out that about 25% of the hard drives that are sold within a given year are made in Taiwan.  When you think about that and pair that number with the fact that the severe flooding covered about 1/3 of the surface of Thailand, you can see that this is set to become a notable "supply and demand" problem for the foreseeable future.  Speculation is that the shortage will be seen in the 4th quarter 2011 and extend into the 1st quarter of 2012.
The other interesting "sub-category" about this subject is the company Nidec.  The currently produce about 70% of the motors that are inside of the hard-dive and power the "spin" of the drives.
Western Digital, the largest manufacturer of hard drives in the world, has been speculated to temporarily lose 75% of their production.
Seagate, the second largest manufacture of hard drives, said in a statement that while their factories are all operational, getting parts is difficult.  Here is part of what their statement said, "Given the volatility of the situation it is unclear what the magnitude of the supply chain disruption will be to Seagate’s hard disk drive output from its Thailand operations. Seagate is actively managing its supply chain and factory output to align production capabilities and optimize its build schedule to meet customer requirements. As a result of the disruption caused by the floods, Seagate anticipates hard drive supply will be constrained throughout the current quarter."
The bottom line is this:  expect to pay more for hard drives for the next 6 months or so.  Also expect that you may not be able to get the hard drive you might be looking for.
I had my first experience with this on Saturday at Micro Center here in Overland Park, KS.  I was attempting to purchase two 1 TB Seagate hard drives.  When I got to the checkout I was told that they could only sell me one hard drive.  I had been reading about the flooding, but didn't realize it was having such an impact.

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