Electronics Industry Bracing for Effects of Thailand Flooding
The electronics industry was dealt another serious blow by the massive floods that devastated Thailand last week, just when it was finally recovering from the supply chain disruptions stemming from the March 11th earthquake and tsunami in Japan. The flooding in Thailand has incapacitated a number of factories that produce key components for a variety of consumer electronic devices.
Thailand serves as a major hub for hundreds of major electronics companies, particularly the firms based in Japan like Sony, Panasonic and others. Since the flooding hit, Thai production of hard drives, cameras and microchips has virtually ground to a halt. The disruption is impacting supplies for companies all around the world, and is expected to diminish the availability of devices like laptops, set-top boxes, video game consoles, and a variety of other products in the coming months.
One company bracing for a devastating hit is Irvine, California-based Western Digital, the world's largest manufacturer of hard drives. With two of its main factories decimated by the floods, the company has had to halt production until October 12th. As the company has greater exposure to the flooding than its biggest rivals, Western Digital is expected to lose the No. 1 spot in terms of hard drive market share this quarter, possibly falling down to third.
On the bright side, there is an ample supply of hard drives available to most laptop manufacturers, as PC demand has declined greatly this year. Insiders say that any shortage in the laptop market would not be felt until early next year, and would be very short-lived, as most companies will have figured out solutions to the problem by March.
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