Western Digital halts hard disk production in Thailand

The extent of the impact in cannot yet be fully determined

The production of hard disks at Western Digital (WD) facilities close to Bangkok, Thailand, has been halted following severe flooding, the company said on Wednesday.

This is monsoon season in Thailand, but the rains this year have been the hardest to hit the country for decades, according to a spokesman at the Thai embassy in Stockholm.

Production was temporarily suspended to protect employees, facilities and equipment, WD said. The extent of the impact on operations in Thailand can't yet be fully determined due to continued flooding, it said.

The flooding is causing problems with the region's infrastructure, including transportation and utilities, and has also resulted in the flooding of supplier facilities, WD said. Some of the company's 37,000 employees have had their homes flooded, but all are deemed safe at this time, the company wrote in a statement.

In the three months to July 1, WD shipped about 60 percent of the 54 million hard disks it produced from facilities in Thailand. The other 40 percent came from sites in Malaysia.

The company will provide further updates as the situation develops, including at a conference call with investors on Oct. 19, it said.

The production delays come at a time when demand for storage is growing, boosted by the growth of cloud services.

Despite the downbeat economic situation, the worldwide disk storage market continued to grow at a record pace during the second quarter, according to market research company Gartner. Revenue for the period totaled US$5.1 billion, an 11.6 percent increase compared to the same period last year. The market for disk storage used by external cloud deployments is on pace to grow to $417.3 million in 2011, a 56 percent increase from 2010.

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Mikael Ricknäs

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