Electronic Manufacturing Services Market

The Electronic Manufacturing Services Market is expected to grow from USD 568.3 Billion in 2026 to USD 930.6 Billion by 2033, reflecting strong industry expansion and registering a CAGR of 7.3% during the forecast period from 2026 to 2033.

Electronic Manufacturing Services Market to Significantly Benefit from Thriving Trend of Outsourcing Production of Electronics

Increased internet usage and the number of connected devices, including smartphones, laptops, tablets, and PCs, have a direct impact on the volume and variety of corporate data. For instance, sensors, and cameras continuously gather location information for surveillance. The ability of an electronics manufacturing services provider to swiftly and effectively adjust to fluctuations in demand is one of the main advantages of hiring their services. This is expected to drive the growth of electronic manufacturing services market. They can now quickly ramp up or down production capacities in response to demand, which can be crucial in an industry with such rapid market change as electronics. Additionally, a lot of suppliers in the worldwide electronic manufacturing services market have experience manufacturing a wide range of electronic devices, which can be advantageous when it comes to developing particular designs. As a result, several businesses have contracted with outside vendors to produce their gadgets.

Numerous businesses are now providing these services at cheaper costs than established suppliers as a result of the rising demand for electronics manufacturing services. In the near future, more businesses may decide to outsource their electronics production as a result of this expanding trend. In-house development, production, and testing capabilities are lacking for a number of consumer electronics OEMs. The price of developing, prototyping, and testing different electronic goods is reduced through the use of outsourced electronic manufacturing services. Additionally, it aids businesses in accelerating the lifespan of product development and achieving high-profit margins necessary for market competition. These obvious advantages are anticipated to motivate OEMs to form strategic alliances and partnerships with industry participants in order to meet consumer expectations, hence accelerating the expansion of electronic manufacturing services market. To quickly accelerate the orders, a number of electronic manufacturing service providers are placing a strong emphasis on creating specialized manufacturing facilities and production lines.

Electronic Manufacturing Services Market: COVID-19 Impact

In the first half of 2020, the COVID-19 pandemic had a significant negative influence on the electronic manufacturing services market. To stop the coronavirus from spreading, a number of regulatory and governmental organisations implemented strict lockdowns at the beginning of 2020. To make matters worse, a number of suppliers of electronic manufacturing services lowered the amount they could produce as a result of supply-chain interruptions and a drop in demand from end-user industries including the consumer electronics and automotive sectors. The work-from-home concept was, however, embraced by businesses all over the world starting in the second half of 2020, which boosted demand for computing hardware such laptops, desktop/PCs, and tablets.

Improvement of Environment-friendly Electronics to Drive Electronic Manufacturing Services Market Growth

The expansion of the electronics manufacturing services market is being driven by the appearance of green electronic products. These devices are produced using recyclable materials, non-toxic chemicals, and low carbon emissions. It improves process control, lowers energy use, and reduces carbon footprints. Electronic items that are greener have been developed as a result of growing global worries about the escalating amount of e-waste. Research co-authored by the UN Environment Program (UNEP$ and the Global E-waste Monitor 2020 estimates that around 53.6 million metric tonnes of e-waste were produced in 2019. The worth of the raw materials in that e-waste was USD 57 Bn. Electronic manufacturing service providers create sustainable plans to reduce emissions in response to the rising carbon emissions, which are mostly produced during the production of electronic gadgets. Key market companies are now concentrating on strategic planning to produce greener electronics products, which is fuelling the expansion of the worldwide electronic manufacturing services market.

Lack of Intellectual Property Rights, and Violations to Hamper Electronic Manufacturing Services Market Performance

As they give business owners a competitive edge, intellectual property (IP) rights are crucial for providing solid legal protection to the inventive invention of electronic equipment. Invasion of these rights not only violates the privacy policies of investors and innovators but also hinders market-wide economic growth. Small and medium-sized businesses (SMEs) typically place more emphasis on quick market expansion than on the value of intellectual property rights (IPR), which could provide a wealth of economic prospects in a more secure setting. Developing nations have trouble allocating funds to bolster their intellectual property systems. In order to secure IP rights, the major market players must adapt their core manufacturing methods. As a result, it is anticipated that the market will not grow if such IP rights are violated or absent.

Electronics Manufacturing Dominant in Electronic Manufacturing Services Market

In 2021, electronic manufacturing, which accounted for 44.3% of the total revenue share, became the top service sector. However, due to the increasing propensity of OEMs to outsource their designing requirements, the electronic design & engineering industry is anticipated to experience strong growth during the projection period. Due to their increasing importance in numerous electronic products, like mobile phones and tablets, among others, key vendors in electronic manufacturing services market for electronic contract manufacturing and design services is now experiencing an increase in demand for electronic circuit boards. OEMs can also create and test prototypes for the development of new products. Additionally, the services offered by contractors allow OEMs to develop innovative products with reduced capital expenditure and cutting-edge manufacturing methods.

Electronic contract manufacturing and design service providers are receiving an increasing amount of OEMs' circuit assembly requirements, which significantly boosts their profit margins. During the projection period, these elements are projected to fuel demand for electronic contract manufacturing and design services, in turn boosting the growth of electronic manufacturing services market. To cut costs and improve flexibility, OEMs are also increasingly thinking about outsourcing their design and engineering. To survive in the fiercely competitive industry, they are boosting their investment in R&D projects and other strategic initiatives to streamline their manufacturing processes. However, the use of cutting-edge technology by electronic contract manufacturers and design service providers for automation such as 3D printing, and Artificial Intelligence (AI) results in a significant initial investment for OEMs. Additionally, establishing in-house production is a significant difficulty for the majority of producers. As a result, OEMs should consider outsourcing if they want to keep up with the increasingly competitive environment.

With Increased Government Initiatives, IT and Telecom Industry Continues to Lead Electronic Manufacturing Services Market

Due to initiatives implemented by governmental authorities throughout the US, India, and other countries, the IT and telecom industry is anticipated to dominate the electronic manufacturing services market with the greatest CAGR over the forecast period. The market for IT and telecom applications is being driven by this initiative, which has also increased demand for consumer electronics, computers, and communication devices. Due to expanding digitization, an increase in IoT-enabled autos, and a rise in the purchase of electric vehicles over the predicted period, the automotive, and aerospace & military categories have seen growth. For instance, according to the International Energy Agency (IEA), 3 million electric automobiles were sold in 2020, a 40% increase between 2019 and 2020. China, and the US are the next-largest markets for electric vehicles, after Europe.

Asia Pacific Retains Top Spot in Electronic Manufacturing Services Market

Due to the expansion of outsourcing activities in these regions, Asia Pacific is predicted to increase at the fastest rate, followed by North America. Asia Pacific also had the largest revenue share in electronic manufacturing services market in 2021 and is anticipated to continue to grow at the quickest rate throughout the projected period. Furthermore, China held a leading position in the region's electronics industry with a share of more than 35%. The primary factors anticipated to encourage the expansion of the local electronic contract manufacturing services market are the widespread availability of raw materials and inexpensive labour. Moreover, a growing pool of competent workers, strong government support, and promising market prospects are the main drivers of the expansion of India’s electronic manufacturing services market. As they work to diversify their product offerings and increase their global footprint, Indian businesses are now concentrating on e-commerce and other non-traditional areas. For items that depend on electronic components more and more, this transition is assisting in cost reduction and establishing a more effective supply chain.

The healthcare and automobile sectors are also important drivers of the North American electronic manufacturing services market. Due to its high mix and low volume, the healthcare sector provides firms in this area that provide electronic contract manufacturing and design services with larger profit margins. The innovative and portable diagnostic goods that these R&D centers and medical institutions are working on are based in North America, and they want to source these items through contract manufacturers. The sum of all these variables is anticipated to drive the expansion of the North American electronic manufacturing services market during the forecast period. Important firms including FLEX, Sanmina Corp., and Jabil Circuit, Inc. are planning to increase their production capacity by expanding their manufacturing sites in Europe. Additionally, it is predicted that during the forecast period, demand for electronic contract manufacturing and design services in America, and Europe will increase due to a transition to sophisticated manufacturing processes in these two continents.

Global Electronic Manufacturing Services: Competitive Landscape

Key Players

• Benchmark Electronics Inc. (U.S.)
• Celestica Inc. (Canada)
• COMPAL Electronics, Inc. (Taiwan)
• Fabrinet (U.S.)
• Flex Ltd. (U.S.)
• Hon Hai Precision Industry Co. Ltd. (Taiwan)
• Jabil Inc. (U.S.)
• Plexus Corp. (U.S.)
• Sanmina Corporation (U.S.)
• Wistron Corporation (Taiwan)

Competitive Landscape

By Product

• Electronic manufacturing

o PCB assembly

o Cable assembly

o Electromechanical assembly/box build

o Testing

o Prototyping

o Others

• Engineering services

o Circuit design

o PCB layout

o Others

• Test & development implementation

o Circuit assembly testing

o Fully assembled unit testing

o Others

• Logistics services

o Inventory management

o Remanufacturing

o Others

By Application

• Computer
• Consumer electronics
• Aerospace & defense
• Medical & healthcare
• Automotive
• Semiconductor Manufacturing
• Robotics
• Agriculture
• Power & Energy
• Others

Region

• North Americ
• Europe
• Asia Pacific
• Latin Americ
• Middle East and Africa