Thailand floods to cut global HDD shipments, raise prices

Persistent flooding across Thailand will lead to the hard disk drive industry’s worst performance in three years according to a new report from IHS iSuppli. Western Digital is expected to lose its vaunted market leader position due to the disaster, paving the way for competitor Seagate to nab the top spot.

Thailand floods to cut global HDD shipments, raise prices

In a note warning that the impact of the weeks-long flooding may be felt into 2012, IHS Storage Systems Analyst Fang Zhang predicted the sharp HDD shipment decline will lead to a global shortage and an average 10 percent price increase.

Due to waterlogged factories and constricted supply lines IHS expects 48 million fewer HDDs will be shipped in the fourth quarter. Last quarter 173 million HDDs were shipped worldwide revealed Zhang, adding that the last time HDD makers posted a comparable loss was in 2008.

Western Digital will take the biggest hit. The company claimed its Thailand-based facilities produced more than 32 million HDDs just before the floods. Neglecting to go into detail, it admitted fourth quarter shipments will likely be unable to meet consumer demand. That may be enough to drop the top dog to third place, said IHS.

Earlier this year, Western Digital led Seagate by just 1 percent in HDD shipments. Though Western Digital is due to slip, its acquisition of Hitachi GST in March could eventually pick up the slack. The deal has yet to be approved.