The flooding in Thailand in October and November 2011 forced the closing of all of the hard drive assembly factories for Western Digital. Seagate does not manufacture or assemble hard drives in Thailand, but it does rely on suppliers located in Thailand, so the flooding prevented Seagate factories from receiving parts needed to assemble hard drives. This shutdown had an immediate affect on the price of hard drives, as supply was reduced and this increased competition between distributors and computer manufacturers to vie for the reduced supply.
The result of the flooding was an immediate increase in the price of hard drives. Prior to the flooding, we were selling 500gb SATA hard drives for $99 and 1tb SATA hard drives for $149. Following the factory shutdowns, prices have increased to $149 for 500gb and $199 for 1tb drives.
While the prices of hard disc drives were affected, solid state SSD drives were not affected, since they use memory chips that are manufactured in other countries.
As of December 2011, Western Digital has been able to resume production of hard drives, so we expect to see a return to normal pricing by January 2012.
