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Hard drive supplies to run dry while Thailand stays wet

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The flood in Thailand caught manufacturers off guard, but damages and losses are more than initially analysed. The outlook of the hard disk supplies are grimly forecasted to run out at the end of the year, leading to backlash in the first quarter of 2012.

It is no surprise that hard drive prices are increasing to the tune of 10 to 60 percent as a result of the flood which crippled factories of hardware manufacturers for weeks. Now a report shows that the supply of storage devices may run out.

Analyst Gus Richard of Piper Jaffray Investment Bank commented that this shortage of hard drives may occur at the end of November, and that tech industrial leaders aren’t proactive enough to take stock of the situation.

Just a few months ago, the tsunami and earthquakes in Japan became the earliest reminder this year of the weakness that the global supply chain possesses, decapacitating car component factories and inducing a major loss.

"Nobody seems to be really paying attention. Everyone overreacted to the disaster in Japan. And now I think they're underreacting," he mentions.

While current analysis shows PC manufacturers are already 60 million hard drives behind the demand of 180 million units, the shortage situation will become more dire in Q1 2012.

In a note by Piper Jaffray, they mention "While it is difficult to calculate, we would estimate that limited drive availability will reduce PCs sales by 10-20M units over the next couple of quarters with 2.5M to 7.5M in demand destruction and 7.5M to 12.5M in deferred purchases."


Source: Cnet

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