Flooding In Thailand Halts Production of Hard Drives

Bloomberg (News - Alert) BusinessWeek reports that floodwaters have swept across 60 of Thailand’s 77 provinces over the past two months, swamping factories operated by Honda (News - Alert) Motor Co. and Canon and destroying more than ten percent of the nation’s rice farms. The report calls it Thailand’s worst floods in more than 50 years.

Severe flooding has also affected the production of personal computer hard drives. As a result, according to Yahoo! News, one of the world's largest manufacturers of PC hard drives, Western Digital Corp. (News - Alert), has halted production at its crucial Thai factory. The company said production in Thailand, where it makes about 60 percent of its hard drives, would be "constrained" in the current quarter, reports Yahoo! News.

According to Yahoo! News, the flooding has killed more than 280 people since late July, and swamped more than two-thirds of country. Plus, it has inflicted billions of dollars in damages.

This report indicates that Western Digital shipped nearly 54 million hard drives in the April-June quarter with 60 percent of those made at its plant near the Thai capital Bangkok. The remainder were produced in neighboring Malaysia.

Other semiconductor companies to report production disruptions due to flooding include Microsemi Corp. and ON (News - Alert) Semiconductor.

In a statement, ," said James J. Peterson, Microsemi's president and chief executive officer, "The entire Microsemi family sends our sympathy to those affected by the significant flooding throughout Thailand… As we assess the impact of our operations in the region, we will continue to focus on the safety of our team and the community. We are working on a recovery plan to identify solutions that ensure our customers' needs are met in an appropriate fashion, and are evaluating a variety of options including shifting production to other facilities,” added Peterson.

The Rojana Industrial Park facility, located 67 kilometers (42 miles) north of Bangkok, manufactures a small percentage of the company's parts for commercial and industrial end markets. Initial reports indicate the facility has sustained water damage as a result of the flooding, impacting operations stemming from damage to test equipment, as well as product slated for delivery in Microsemi's (News - Alert) first fiscal quarter ending January 1.

Likewise, ON Semiconductor also announced that its SANYO Semiconductor division’s operations located in the Rojana Industrial Park in Ayutthaya, Thailand, have been suspended as a result of recent flooding in the region. The company has confirmed that there have been no on-site injuries to ON Semiconductor employees in Thailand as a result of the flood.