History (1999): Fujitsu Investing Substantially in Thai HDD Plant

Fujitsu has 2 huge HDD plants outside of Japan, one in the Philippines, for SCSI units, the larger of the 2 in Thailand for 2.5- or 3.5-inch AT devices.

The manufacturer produced a total of 17.5 million drives in 1998, 60% of which roll off the assembly line of the Pathumthani fab, 50 km north of Bangkok, according to MD Masao Suzuki.

But the Japanese parent company has major ambitions for the storage industry, and in particular hopes to increase its slice of the global pie. In December, Fujitsu announced that it would invest an additional $460 million in the Thai plant to increase production from roughly 800,000 units per month in 1998 (with a record 1.1 million units in November 1 998), to 2 million this year and 3 million in early 2001, driving sales from $1.1 billion last year to $2.02 billion within three years.

The company makes no bones about its goal: to become one of the top 3 HDD suppliers in the world.

“With over 6 million HDDs shipped in 4CQ98, Fujitsu increased its unit volumes by 52% over the prior quarter and by 83% over 4CQ97,” the company recently stated, attributing its success to an IBM-like vertical integration strategy.

Total employment in Pathumthani, currently 5,500, including a hundred Japanese, is expected to top 18,000 workers after expansion.

Susuki qualifies these figures, which he cautions depend on the market and on sales. Of course, all this relates only to the HDD business, since the Pathumthani factory also produces printers, electronics and computer parts, as well as telecommunications equipment.

Outside of the basic components (heads, platters), which are obtained externally, vertical integration is virtually total. The fab produces PCBs, sliders, stepper motors, flexible printed circuit assemblies, and also handles part of the HGA, HSA and HDA.

What’s so curious is that Fujitsu is able to undertake all these operations with so few workers. It is likely that a considerable amount of the assembly is automated, since Fujitsu also manufactures most of its own tooling equipment, but we were unable to confirm this after a tour of only the head disk assembly cleanrooms.

The work is organized in 2 daily 12-hour shifts. It takes roughly 40mn to put together a drive.

Management puts the accent on the quality of testing for drives coming off the line, between 6 and 11 hours for each unit, including an acoustic noise test. Moreover, month-long tests are performed on a sampling of 300 drives.

The Thai plant has made the transition entirely to MR drives, although GMR 3.5-inch units are already being assembled.

Plans to convert all production to GMR heads should be implemented by the end of the year.

This article is an abstract of news published on issue 134 on March 1999 from the former paper version of Computer Data Storage Newsletter.