Seagate Shuts Down 1 of 3 HDD Production Facilities

With the continued rise of the SSD, the decline of HDDs has continued to accelerate. Last year, HDD manufacturer Seagate announced a series of significant cuts aimed at cutting costs. As part of the reduction to drive production, the company is closing down their Suzhou, China facility. The plant represents one of three Seagate drive production facilities where the HDDs are put together and assembled.

These cuts are part of the winding down of production from about 55 -60 million drives per quarter down to about 35-40 million drives per quarter, about a 33% reduction. While previous layoffs were larger by about 8,000 employees, the 2,200 being let go now will actually reduce the company’s ability to manufacturer drives. This means if for some reason the HDD takes off again, Seagate won’t be able to respond to it.

Seagate still has two HDD final production facilities at Wuxi, China, and Korat, Thailand. Due to the increasing capacity of drives though, the raw storage capacity being produced by Seagate may remain unchanged. As the HDD industry continues to evolve, more money will likely have to be spent on R&D to keep increasing capacity and density. It will be interesting to see what the company will do with their facility moving forward.