HDD prices rising

Tak Ne said:
From that story...

Worldwide total Q4 hard drive production is expected to be about 120 million units, down from 176 million in Q3.

That makes it sound like its not that big a problem.
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No kidding. I figured they were basically down to not producing any at all, and just trying to make the current stock last as long as possible. If they're still producing like 70% of normal production I don't get why the prices are going up this much. It's not like there are none being produced. They can probably bring in the currently unemployed people from the down plants to work the other plants and just run those plants longer to make up for it.

This is clearly price fixing by the manufacturers to take advantage of people's panic.
 
Red Squirrel said:
No kidding. I figured they were basically down to not producing any at all, and just trying to make the current stock last as long as possible. If they're still producing like 70% of normal production I don't get why the prices are going up this much. It's not like there are none being produced. They can probably bring in the currently unemployed people from the down plants to work the other plants and just run those plants longer to make up for it.

This is clearly price fixing by the manufacturers to take advantage of people's panic.
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Really? Do you work in industry? Do you work with component suppliers? Have you ever been in an event where what you critically need is not available? You can't have otherwise you wouldn't have posted what you did.

The moment demand exceeds supply, prices always start rocketing. The primary reason why is most companies now operate on low inventory and posted lead times. Furthermore, the HDD is not the end item. It is a core element of a larger piece. The piece cannot be sold without that item. Therefore, imagine telling people, they will have to sell 30% less PC's next year. Talk about a fucking fiasco.

Also, most plants of electronics don't operate at 60% or 70%, they run at 95%. Anything less than that and your competitor will eat you alive with more efficient costs. They are running 24/7, 365.
 
The number is misleading anyway, it's not production it's deliveries. Production has been hit harder, and that's why Q1 2012 will really suck. And people are not what's lacking, it's machines that have been destroyed by the floods, and are long to produce, and rare to begin with.
 
Trepidati0n said:
Really? Do you work in industry? Do you work with component suppliers? Have you ever been in an event where what you critically need is not available? You can't have otherwise you wouldn't have posted what you did.

The moment demand exceeds supply, prices always start rocketing. The primary reason why is most companies now operate on low inventory and posted lead times. Furthermore, the HDD is not the end item. It is a core element of a larger piece. The piece cannot be sold without that item. Therefore, imagine telling people, they will have to sell 30% less PC's next year. Talk about a fucking fiasco.

Also, most plants of electronics don't operate at 60% or 70%, they run at 95%. Anything less than that and your competitor will eat you alive with more efficient costs. They are running 24/7, 365.
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70% is still a lot. A smart company will never operate on 100% of it's resources. You operate at 50% so if something happens you are not dead in the water. For example if you are a data center you have a certain amount of bandwidth, and you average 50% usage, not 100%, so if a provider goes down, you still have enough bandwidth to operate. Isn't the same thing true here? If you see that you are operating at 100% all the time, then you increase production, you increase bandwidth, or w/e the product it is you depend on.
 
Red Squirrel said:
No kidding. I figured they were basically down to not producing any at all, and just trying to make the current stock last as long as possible. If they're still producing like 70% of normal production I don't get why the prices are going up this much. It's not like there are none being produced. They can probably bring in the currently unemployed people from the down plants to work the other plants and just run those plants longer to make up for it.

This is clearly price fixing by the manufacturers to take advantage of people's panic.
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While there is some element of panic, it is the marginal buyer who determines the price. Prices will go up until 30% of the demand is reduced, to get the supply to match up with demand.

Also note that the prices in the retail channel will be hit the most. HD companies will make sure that the OEM contracts are fulfilled and the big boys get the stuff the need. So if the OEM channel was consuming 60% of the consumption and the retail 40% (I think it will be even more skewed towards OEM) , then with 70% production the retail channel will be getting just 25% of its original demand. So prices in retail will have to rise till demand reduces by 75%
 
aviat72 said:
While there is some element of panic, it is the marginal buyer who determines the price. Prices will go up until 30% of the demand is reduced, to get the supply to match up with demand.

Also note that the prices in the retail channel will be hit the most. HD companies will make sure that the OEM contracts are fulfilled and the big boys get the stuff the need. So if the OEM channel was consuming 60% of the consumption and the retail 40% (I think it will be even more skewed towards OEM) , then with 70% production the retail channel will be getting just 25% of its original demand. So prices in retail will have to rise till demand reduces by 75%
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That explains why the RETAIL drives are more expensive than the OEM ones and why the major retailers are putting a limit of 1 per customer.
 
Ah that would make sense, so basically the OEMs are getting first dibs / higher priority so to avoid consumers from buying too much they're just increasing prices and adding these limits.
 
Red Squirrel said:
Ah that would make sense, so basically the OEMs are getting first dibs / higher priority so to avoid consumers from buying too much they're just increasing prices and adding these limits.
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Actually. OEM gets priority treatment. Then comes the smaller computer manufacturers, they have to protect themself against HDD shortage, so they give you, the final customer a limit and high price, so only those who really need the hard drives will take from their very small pool of hard drives (which won't be easily filled again) - so in case they will need hard drives for their own builds, they will have some spare in next few months.

Sure, it sucks for final customers like you & me, but from business point it makes sense.
 
My two Seagate 2TB green's that I picked up this summer for $59 each from Canada are now $189 each . Holly crap monkeys. :eek:
 
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If you can wait on purchasing, prices will fall..... If you buy at these prices they will continue to price them at this level!

From what I have read they are recognizing there supply chain and shouldn't affect supply's that greatly. BUT I'm certain they will try there best to put fear into your hearts as though the one you see on the shelf, is the last hard-drive within a 500 mile radius ......lol

The corporations are working overtime to see to it that prices stay at these levels for as long as possible!!!!!!!!
 
purchased 3tb WD network drives 3 weeks ago at 165$ now they are 299$ at the same store!
 
Aesma said:
The number is misleading anyway, it's not production it's deliveries. Production has been hit harder, and that's why Q1 2012 will really suck. And people are not what's lacking, it's machines that have been destroyed by the floods, and are long to produce, and rare to begin with.
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not really they are more specialized than they are rare the problem being that since the machines are only made when a hard drive company needs them for a factory they are not in high demand and who ever makes them can charge almost what they want for them. And i would imagine that there is a very limited number of people who can repair them when they breakdown.
 
Red Squirrel : the companies involved, WD, Seagate, Nidec, have each several plants. Most of them are in Thailand, but not all at the same place. It turns out the whole country is under water, something that wasn't deemed possible. So yeah, production is badly affected, and ramping it up in other countries will be far from sufficient.

Lunas said:
not really they are more specialized than they are rare the problem being that since the machines are only made when a hard drive company needs them for a factory they are not in high demand and who ever makes them can charge almost what they want for them. And i would imagine that there is a very limited number of people who can repair them when they breakdown.
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I'm not sure why you're disagreeing with me. They're made on demand, no stock, only a few companies in the world need them, and only one makes them == rare.
 
djstarfox said:
Most interesting point to the news: Seagate does NOT have a plant in Thailand, so their prices shouldn't go up (as much).
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While this might be true, i think the biggest issue is the Nidec plant that does the motors for most of the hdds, even Seagate isnt fully indepentant, so they could build the drives but without motors... Also even if they had another source, they cant cover the hole world supply, so since there is more demand, price will go up regardless. But there is hope, Good News For Nidec, Others: Thailand Hard Drive Loss Not That Bad.

The good news comes direct from Nidec (NJ), the leader in hard drive motors, which says its Thailand plants have already resumed production and that the current supply gap could close by the end of the quarter.
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djstarfox said:
Most interesting point to the news: Seagate does NOT have a plant in Thailand, so their prices shouldn't go up (as much).
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Who is lying then ? :
http://www.seagate.com/ww/v/index.j...toid=938e2b7b54a1e010VgnVCM100000dd04090aRCRD

Seagate Thailand operations include Slider Operation, Head Gimbal Assembly/Head Gimbal Stack Assembly (HGA/HGSA) and Drive Assembly. It is also our corporate strategy to bring more development and research work into Seagate Thailand Operations. Our plants in both Teparuk and Korat employ more than 11 thousand employees including more than 700 engineers. We produce more than 50 million disk drives annually.
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Their plants in Thailand haven't been flooded, from what I understand. Which does not mean they're making anything at the moment, since they might not have electricity and other supplies.

Also, I'm told that some of the flooded plants in Thailand were protected by levees, so the manufacturers weren't that dumb, it just turned out that the floods are record ones.
 
As someone who purchases a fairly large number of drives per quarter, I can tell you that you probably shouldn't expect hard drive prices to come down anytime soon. Government, Military, and large contractors such as GD, Lockheed, Northrop, etc..have all started making arrangements for low availability and high prices for the next two quarters. I have seen more risk analysis emails and paperwork in the last two weeks than I ever have. It's hard enough sourcing 1x 900TB SAS drive right now...try needing to source 150 of them for a single requirement. That has a lot of people scrambling around.

The general consensus is that it will get worse before it gets better. Many suppliers after hearing the news bought up all the drives they will need for the 4th and 1st quarter (if they could afford to do so). That's a lot of demand all at once. And most will tell you that it willl probably be the middle of 2012 before things start to settle back down. Then you have the companies that take any crisis and see it as an opportunity to get rich...I spoke with one very large company out there that I would classify as a retailer, and their national sales manager said that they started restricting purchases of drives to single units (some up to 5) because they had a rush of people trying to buy whatever they could get their hands on in large quantities becuase they wanted to try to jack the price and resell them. At that time they had kept their prices at reasonable levels which was very commendable, but they have since succumbed to market pressures and raised their prices accordingly.

You also have a large contingent of companies that are wieghing the fact that if they have one hard drive to sell, do they:

a. sell it to a guy who just wants a hard drive and make $3 on it
b. sell it to a guy that wants to buy a full server or workstation with multiple drives and highend components and make the profit that comes with that.
c. Any number of other oppotunities where selling one drive to one guy doesn't hold up against it.

Large OEMs such as HP, Lenovo, Dell, and EMC will get thier drives...and prices may go up a few bucks for them per unit. It wont be what you see out for sale at newegg or CDW...Seagate and WD are raising prices on drives before they are even shipped...I have seen drives that are backordered for $55, now shipping FROM seagate direct for $97. That's not retail driving the price up, that's Seagate and WD trying to keep profits up because if they planned on shipping x number of units, and now can ship only y number of units...they aren't going to make the same profits off of y that they would have off of x...unless they raise prices.

From my understanding of the situation, all eyes are firmly fixed on the supply chain, especially Nidec who had 80% of its HDD component manufacturing capacity submerged. They are making efforts to move that capacity to their mainland China and Philipines plants, but it's too early to tell if they can make that happen. Reports are starting to come out that they have had some success, but we'll see...give it a couple of weeks.

You also have to worry about your work force...even if they could get new production equipment at the drop of a hat (which they can't), their workforces houses and neighborhoods are also flooded and they have lost everything. I don't know if you have ever been to Thailand, but their infrastructure is pretty bad...even in the tourst areas...it's just not up to other countries standards. It sucks too, because as a whole, the Thai people are some of the most friendly people out there...but hey bad things happen to good people. By the way, earnings estimates for companies that make the equipment that is used to build, test, etc hard drives are all through the roof...

An whoever said Seagate doesn't have plants in Thailand, I can turn around and see several 20packs of Seagate drives that say "Made in Thailand" on them. They have plants that are unaffected as they up on a plateau, however if you can't get parts to them because the roads are flooded out, and your main component supplier is flooded as well...you are basically a donut shop that can't get flour.

By the way...these manufacturers don't just make the product there...they warehouse the product there...rumors abound that those were hit by the flooding as well, but so far I haven't read anything or spoken to any one that would substantiate those rumors...yet.
 
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When does it seem likely the prices will come back down? Are we talking about years?

I wish I bought that Seagate for $45-50 a month ago.:(
 
Flogger23m said:
When does it seem likely the prices will come back down? Are we talking about years?

I wish I bought that Seagate for $45-50 a month ago.:(
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well that is tricky it will be at least 6 months till the factories are re opened and begin production again after that i would expect a bit of free fall and price fixing to happen so at least a year till prices are stabilized... and i would think that they would keep the prices artificially high as long as they can to make up for the losses so we will see these prices or close to them for at least a year and the price wont drop back to what it was for about 2-3 years that is baring this type of incident happening again...


So cliffs
1. 1-2+ years
2. Yes it is in years provided they dont just rebuild and have it flood again next year...
 
I think that's one of those questions, where if you know the answer to it, you stand to make a lot of money from that information. Which is to say no one has any concrete idea. Even if you dont have contacts in the industry, just googling western digital or hard drive and thailand flooding, you will see a common timeframe that is painted across all of the articles, editorials, and press releases...and that's that manufacturers expect to have things rolling again in March 2012. From that point it's a matter of getting the finished product where it needs to go, and then seeing the backlog on orders and who is requesting what. Different market segments have different demands for storage, so while retail PC sales may slump, other areas may have a higher demand than the previous quarter. That being said, I would venture to guess that as of this moment, there aren't very many IT depts making plans for rolling out large new data stores in the next 6 months. But it will be awhile before prices are back to where they were three weeks ago...and trust me, I would gladly be wrong about that.

Deals can still be had...a good option are places like Office Max/Depot, Staples, etc. You can also still get some good deals on external drives...which you can obviously just take out of their enclosure.

And to add to the post above me...there is an article that has a Thai Commerce or Infrastructure official saying that he will guarantee "1 million percent" (yes he went there) that the flooding will be just as bad next year...cyclical weather patterns.
(edit: found it, Science and Technology minister: http://www.nytimes.com/2011/11/07/business/global/07iht-floods07.html?_r=1&pagewanted=1&ref=disasters )

I am hearing that laptops are next...Asus apparently is having issues getting hard drives...others will follow I'm sure.
 
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Lunas said:
well that is tricky it will be at least 6 months till the factories are re opened and begin production again after that i would expect a bit of free fall and price fixing to happen so at least a year till prices are stabilized... and i would think that they would keep the prices artificially high as long as they can to make up for the losses so we will see these prices or close to them for at least a year and the price wont drop back to what it was for about 2-3 years that is baring this type of incident happening again...


So cliffs
1. 1-2+ years
2. Yes it is in years provided they dont just rebuild and have it flood again next year...
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I really wished I saw it coming when the first flooding in Thailand occurred and get that hard disk I planned to buy early next year.:mad:

Now I'm just keeping my fingers crossed that none of my hard disk fails in the next 12 months.
 
ricky_005 said:
If you can wait on purchasing, prices will fall..... If you buy at these prices they will continue to price them at this level!

From what I have read they are recognizing there supply chain and shouldn't affect supply's that greatly. BUT I'm certain they will try there best to put fear into your hearts as though the one you see on the shelf, is the last hard-drive within a 500 mile radius ......lol

The corporations are working overtime to see to it that prices stay at these levels for as long as possible!!!!!!!!
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Way to marginalize a catastrophic natural disaster into a ploy for corporations to keep up profits.

Realize that alot of these high tech components are made in these countries where the workers can't even buy one for themselves. I wouldn't surprised that prices will stay at they are for abit until:
A.) Factories get rebuilt with all the necessary support.
B.) Companies find a new, more landlocked, place to put place a factory.
 
Penn States busted, Thailands under water & the rest is being burnt by protesters (at least there's water to put out the fires) Oh my Gog !!! Where are all the sick sex peple going to go for some nooky ? ;)
 
Lunas said:
well that is tricky it will be at least 6 months till the factories are re opened and begin production again after that i would expect a bit of free fall and price fixing to happen so at least a year till prices are stabilized... and i would think that they would keep the prices artificially high as long as they can to make up for the losses so we will see these prices or close to them for at least a year and the price wont drop back to what it was for about 2-3 years that is baring this type of incident happening again...


So cliffs
1. 1-2+ years
2. Yes it is in years provided they dont just rebuild and have it flood again next year...
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2+ years do get back to the same prices as before the flood?? :eek:
 
Where are all the sick sex peple going to go for some nooky ?

This made me laugh. A lot. Out loud.
Just another one of my bad jokes, especially the PS part - that is shamefull (to know & do nothing) But on a lighter note the HDD manufacturing situation in Thailand is pretty serious & may require relocating HDD factories to other countries.
 
I was about to buy some HDDs from , till I noticed the horrific prices o_O, the price of WD20EARS doubled, and may have even tripled (I remember buying them at $75?, not $220).


Wtf?! Was about to create a thread till I saw this, glad its not just my computer trying to prank me.
 
Friend of mine got a 1tb WD Green yesterday for $60 from office depot, said they also had Seagate 1TBs for $80
 
I just told my wife today that in 6 month I will have to plug our blu-ray player back into our TV and she will have to use dics; she isn't happy. However, maybe she will considering getting rid of some of those trashy b-rated romantic comedies. Hrm...this flood could be the best thing ever.
 
Trepidati0n said:
I just told my wife today that in 6 month I will have to plug our blu-ray player back into our TV and she will have to use dics; she isn't happy. However, maybe she will considering getting rid of some of those trashy b-rated romantic comedies. Hrm...this flood could be the best thing ever.
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A little housekeeping, for whatever reason is always good. Right? ;)
 
Shit I just built a tower yesterday at microcenter and had to pay $43 for a wd blue 320gb hard drive. Guess its good I don't need a lot of storage.
 
Bman123 said:
Shit I just built a tower yesterday at microcenter and had to pay $43 for a wd blue 320gb hard drive. Guess its good I don't need a lot of storage.
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thats dirt cheap, they are $100+ on newegg, i have a pair of AAKS Blue 320's sitting in the closet, was considering selling them now but I'd rather wait and be sure I have storage in a few months
 
I am going to be curious to see if some of the drives that when they do get back into production have flaws or bad fail rates due to bugs or residual contamination in the new equipment...


Either way i am glad i grabbed the 750 gig drive for my laptop when i did it jumped from 99.95 to 159.95 the day after i ordered it. Also has anyone noticed there are no more advertisements for hard drives on sale...
 
funkydmunky said:
My two Seagate 2TB green's that I picked up this summer for $59 each from Canada are now $189 each . Holly crap monkeys. :eek:
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....$249.00 today on NewEgg. Jebuz. Krist.

I bought three earlier this year; two for a NAS box and one for our house security camera DVR. Turns out the DVR wouldn't accomodate the 2TB drive so I have a spare. Think I paid $69.00 or something like that. Should have bought a hundred.....:rolleyes:
 
Lunas said:
I am going to be curious to see if some of the drives that when they do get back into production have flaws or bad fail rates due to bugs or residual contamination in the new equipment...
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I've been thinking the same. I'm thinking the first few batches will have lot of DOA units, and they'll still be expensive just to make up for the cost of processing the influx of RMAs. That or they will end up doing a full blown batch test, which will cost a lot and still keep the prices high.
 
I bit on a 2TB minimus external Lacie dive today from BB for $99. I just didnt want to risk going a year with the prices being sky high.

Btw does anyone know what kind of drive is inside this?
 
techie81 said:
I bit on a 2TB minimus external Lacie dive today from BB for $99. I just didnt want to risk going a year with the prices being sky high.

Btw does anyone know what kind of drive is inside this?
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start->(right click)computer->manage->device manager->disk drives->google part number
 
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