History (1999): Tidal Wave of Lay-offs

If, after sacking the coach, the team record was still lackluster, the owners would turn to the lineup. There, too, in a very short period of time, the storage industry has seen its numbers slashed.

Western Digital: 2,500
It had decided to focus all its energy on the production of desktop drives in its Kuala Lumpur, Malaysia facility. This involves the lay-off of 2,000 workers directly, 500 indirectly, from the Chai Chee, Singapore factory before December 1999. The latter plant will now focus on desktop HDD development and component qualification, as well as on production of high-end drives.

Seagate Technology: 1,600 [and 6,400 more]
It is eliminating 1,600 jobs in its different facilities in Singapore, or roughly 10% of its workforce in that country. 600 additional lay-offs are also planned for its Chinese operations. It has closed its Tuas, Singapore disk media plant, which counts roughly 900 people.

Komag: 400+500+480=1,380
There’s considerable upheaval at this magnetic media maker, which is losing 1,380 people, or 29% of its total workforce. Recall that Komag acquired Western Digital’s disk media plant last April. No more: the factory shut down 15 months ahead of an earlier transition plan. That’s already 400 fewer people. Second decision: consolidate the separate engineering and anagerial staffs of its San Jose, CA-based manufacturingand R&D organizations into only one organization. Another 500 fewer people. Up to now, all this was the work of CEO Stephen C. Johnson. His replacement, T.H. Tan, has wasted no time keeping the ball rolling, with his decision that the company’s Malaysian factories, which employ 2,750 people and which now account for 60% of production, will take on 100% by the end of the year. This means that Komag’s US workforce will drop from 1,050 to 570, or a total loss of 480, 250 of which have already left. All that remain now are 350 people in San Jose, plus 220 in Santa Rosa, CA, where there is an automated substrate manufacturing facility.

Quantum: around 800
One thing is sure: the unannounced product development programs in Quantum’s desktop HDD business have been consolidated, which will lead to an immediate initial reduction of 115 employees. At the same time, the company has stated that a supplemental reduction of 650 to 700 people will take place at Quantum’s drive configuration centers and warehouses in Milpitas, CA, and Dundalk, County Louth, Ireland, due to the fact that more customers are shifting from custom- to standard-configurations and also because a higher percentage of drives are shipping directly from MKE.

Hutchinson: 500
The WW leader in the disk suspension market will lose 500 positions in Hutchinson, MN before the end of the year, as the result of the transfer of assembly operations from that site to Eau Claire, WI, and Sioux Falls, SD, where the number of personnel will subsequently increase. Before this, the company employed 8,000 people, 3,700 alone in Hutchinson, despite the firm’s difficulty finding workers, and another 2,400 in Eau Claire, 1,700 in Sioux Falls and 200 in suburban Minneapolis, MN.

StorageTek: 500
It has decided to eliminate 500 net positions, and has already proceeded with 250 lay-offs.

Exabyte: 200
The majority of the 200 lay-offs, which translate to nearly 16% of its total workforce, will hit the corporate HQ in Boulder, CO. 1,275 people had been employed by the company, which has now also combined its 8mm drive and library hardware operations into a single unit, the storage products division, led by Dr. Farouk Al-Nasser. Mammoth-2 expected this fall, as is Messie.

This article is an abstract of news published on issue 140 on September 1999 from the former paper version of Computer Data Storage Newsletter.