STX Seagate Technology Holdings PLC

Severe floods in Thailand forced the capital's Don Mueang airport to close on Tuesday and the government announced a five-day holiday to let people evacuate flooded areas on the outskirts of Bangkok.

Don Mueang airport suspended aviation activities from 0700 GMT Tuesday until Nov. 1 as a result of flooding. Waters approaching Thailand's capital Bangkok from the north started to submerge parts of the airport affecting runway safety as well as the airport's power sources, said Don Mueang Airport Director Kantpat Mangalasiri.

Thailand's cabinet Tuesday said that Oct. 27 to Oct. 31 will be declared government holidays in 21 provinces affected by the country's worst floods in decades including Bangkok to allow the public to deal with the crisis.

The government has called on businesses--other than those related to selling crucial items such as food and water--to close during those days, the cabinet said in a statement. But The Bank of Thailand said that it has decided not to announce a special holiday for financial institutions, meaning financial markets will continue to operate as usual.

Thailand's worst flood in decades, which has already killed more than 300 people, has dampened the economic outlook for the country. Bank of Thailand Governor Pransarn Trairatvorakul said Tuesday that the severe flooding in the country will likely drag economic growth this year to below 3%, but reconstruction activities should boost growth next year to over 4.0%.

The flood waters are also creeping further into the city of 12 million people after three months of heavy rains that have plagued other parts of the country.

The automobile and computer component sectors have been hit especially hard: A factory run by Honda Motor Co. is completely submerged while a shortage of parts forced industry leader Toyota Motor Co. to extend a production shutdown until Oct. 28, potentially tarnishing Thailand's reputation as the "Detroit of the East."

Thailand is also the world's second-largest supplier of hard drives. Market research firm IHS iSuppli has warned that global output of the devices could fall by 30% in the last three months because of the floods, while Apple Inc. Chief Executive Steve Cook said in an analyst conference call that he anticipates a shortage of disk drives in the coming months.

California-based Western Digital Corp.'s plants are closed in the country, while Seagate Technology said its plants are still in action but could soon face a shortage of parts.

On Tuesday, Japan's Canon Inc., which makes digital cameras, revised downward its full-year outlook due to concerns about the impact from the flooding in Thailand. Although Canon doesn't operate its own camera plants in Thailand, its inability to secure supplies of certain parts from local companies hit by the flooding is adversely affecting Canon's camera business. Despite ongoing steps to broaden parts orders, the company said it will inevitably suffer some negative impact toward the year-end shopping season.

Canon also said Tuesday that it is proceeding with a temporary shift of ink-jet printer production to a plant in Vietnam and another Canon printer plant in Thailand. It expects damages to some of its facilities in Thailand due to the flooding along with output delays for some of its products. The company said the flooding in Thailand will lower its sales and operating profit by Y50 billion and Y20 billion, respectively, in the fourth quarter.

Meanwhile, Honda Motor Co. said Tuesday it has halted production in Malaysia due to parts supply disruptions caused by flooding in Thailand, in the latest sign of the spreading business impact of the disaster. Honda said in a statement it has yet to decide when to resume operations in Malaysia.

The Japanese car maker had scaled down production in Malaysia from Oct. 10 in an effort to avoid a complete halt in manufacturing operations in the country.

Toyota Motor Corp. said Monday that it will cut back production in Japan at least through Friday to cope with expected shortages of some parts from its Thai operations. That followed its decision to scale back output in Indonesia, the Philippines and Vietnam this week due to a parts bottleneck.

-By Phisanu Phromchanya, Dow Jones Newswires; 662-690-4200; phisanu.phromchanya@dowjones.com

--Yoshio Takahashi, James Hookway and Hiroyuki Kachi contributed to this article

Grafico Azioni Seagate Technology (NASDAQ:STX)
Storico
Da Lug 2024 a Ago 2024

Grafico Azioni Seagate Technology (NASDAQ:STX)
Storico
Da Ago 2023 a Ago 2024