Auto, computer industries feel impact of Thailand floods
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Steve Chiotakis: Things are drying out in Thailand, but because of the geography there, flood waters are still flowing from the countryside into the capital city of Bangkok. Today, more than one-third of that city’s districts are under some sort of evacuation order, and flooding could last for a couple more weeks, further disrupting the world’s supply chain.
The BBC’s Rachel Harvey is in Bangkok with the latest. Hey Rachel.
Rachel Harvey: Hello there.
Chiotakis: How much more damage could two more weeks of flooding create?
Harvey: It could create quite a lot more damage, because the longer these floods persist, the longer this crisis goes on, then the more — both in terms of human damage, but also economic damage — this is causing. There is the threat to another bunch of factories; that means potentially more workers that are going to be temporarily out of work. So the longer this goes on, the worse it seems to get.
Chiotakis: A lot of people didn’t realize, Rachel, that Thailand was such a key manufacturing base. Where does Thailand sit in the global supply chain?
Harvey: It is a key point of transit for both computer parts — hard drives in particular — but also auto parts. It supplies other parts of the world but it also has assembly plants here; so in both cases in the auto industry.
But also the parts shortage is causing big problems much further afield. In the United States and in Europe, for instance, Honda has had to cut production. Same with computer hard drives. Looking ahead towards the Christmas rush, there are already worries that they’re just not going to be able to get the kind of parts they need. So it is a crucial hub in this region — not just for Asia, but much further afield.
Chiotakis: The BBC’s Rachel Harvey in Bangkok. Rachel, thank you.
Harvey: You’re welcome.
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