Floods during the monsoon and cyclone season are common in Thailand, but the one that recently hit the country had profound effects on its citizens, economy, and global supply chains. Having discussed in about class supply chain operations, it’s interesting to note the effects of the flood, keeping in mind that 70% of Thailand’s GDP comes from the manufacture and export of computer parts, cars, and textiles.

Thailand’s largest vehicle manufacturer, Toyota, experienced lost output of 37,500 vehicles and closed assembly plants in parts of the US due to problems in getting parts from factories in flooded areas. Honda, Nissan and Ford are also experiencing similar types of disruptions. And in the industry of computer hard disc drives, companies such as Western Digital and Nidec have shut down factories in Thailand. As a result, component prices are expected to rise.

As Yuen Pau Woo, president of the Asia Pacific Foundation of Canada, stated: “When you have a unforeseen disaster like this, the ripple effects are very, very profound.” Faced with unpredictable disasters, more companies find themselves forced to move away from just-in-time production and attempt to set up multiple locations for parts and assembly.

Word Count: 192

Sources: Flash, A. (2011, October 28) Folio: Flooding in Thailand. The Globe and Mail, A9

Photos: http://aibob.blogspot.com/2011/10/thailand-2011-great-flood.html