Electronic Manufacturing Services (EMS) Market (Updated Version Available)
Electronic Manufacturing Services (EMS) Market | Size, Share & Trends Analysis, By Service (Electronics Manufacturing Services, Engineering Services, Logistics Services, Test & Development Implementation, and Others), End-Use (Aerospace & Defense, Automotive, Consumer Electronics, Healthcare, Heavy Industrial Manufacturing, and IT & Telecommunication), By Region, Forecast Period 2022 - 2030
Report ID : RI_673782 | Date : September 2024 |
Format : 
Key Market Overview:
Electronic Manufacturing Services (EMS) Market is estimated to reach over USD 1,037.25 Million by 2030 from a value of USD 510.12 Million in 2022, growing at a CAGR of 8.90% from 2023 to 2030.
Electronic Manufacturing Services (EMS) are a type of outsourcing service, including a range of services offered by companies that design, manufacture, test, and repair electronic products. The EMS providers are responsible for all aspects of the production process including sourcing raw materials & components, designing & testing the product, and assembling & delivering the finished product. EMS providers are focused on delivering high-quality products to ensure product reliability and conformity to industry standards.
The rapid growth of the consumer electronics industry, fueled by the increasing popularity of smartphones, laptops, and wearable technology is driving the demand for EMS services. Companies are increasingly outsourcing their electronics manufacturing operations to EMS providers in order to focus on their core competencies, which in turn is fueling the adoption of electronics manufacturing services. For instance, in March 2022, Sanmina Corporation and Reliance Industries Limited completed a deal to set up a joint venture for electronics manufacturing services in India. The goal of the joint venture is to bring together Sanminas expertise in electronics manufacturing and Reliances experience in creating world-class manufacturing infrastructure in India.
Electronic Manufacturing Services (EMS) Market Coverage
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Market Dynamics:
Driver:
Increasing dependence on EMS providers to reduce manufacturing costs is driving the market growth. Original equipment manufacturers (OEMs) are increasingly outsourcing their manufacturing operations to EMS providers as it allows them to reduce their overhead costs, including labor, equipment, and inventory. The EMS providers have the expertise and resources to invest in the latest technologies such as 3-D printing, robotics & automation, and digital manufacturing which helps companies to fasten the product development process. Therefore, partnerships with EMS providers help companies such as Apple Inc., General Electric (GE) to reduce costs associated with electronic manufacturing which is driving the growth of the electronic manufacturing services market. For instance, Apple outsources the manufacturing of its iPhones and other electronic devices to EMS providers including Foxconn and Pegatron.
Restraint:
Intellectual property (IP) rights are crucial for providing secure legal protection to innovative creations, giving businesses a competitive edge. Violating these rights not only breaches the innovators and investors privacy policies but also hinders economic growth. Failure to address IP rights violations is expected to impede market growth and limit business opportunities.
Opportunities
The rising adoption of electric vehicles provides lucrative growth opportunities for the electronic manufacturing services (EMS) market during the upcoming period. The surge in production of electric vehicles is leading to an increase in demand for advanced electronics including batteries, power electronics, and control systems. Additionally, the EMS companies play a crucial role in providing the required manufacturing and engineering services to support the development of these advanced electronics. Furthermore, the development of electric vehicle charging infrastructure is also expected to create new opportunities for EMS companies to provide services such as design and installation of charging stations.
Point of Sale (PoS) Market Segmentation:
By Service
Based on service, the market is segregated into electronics manufacturing services, engineering services, logistics services, test & development implementation, and others. The electronic manufacturing segment dominates the global market due to increasing consumer\\\'s demand for customized electronic products. Companies are increasingly seeking the services of EMS providers to aid in the design and manufacturing of products that fulfill the unique requirements of their customers. For instance, in October 2022, Celestica launched DS1000 Ethernet switch, a compact, cost-effective, resilient, and open network switch for data centers and enterprise deployments.
Engineering services are expected to register a highest CAGR during the forecast period owing to the increasing complexity of electronic products. The growing complexity of products demands specialized expertise for their design and development. EMS providers that offer engineering services help clients to design and develop products that meet specific requirements, while also ensuring that the products are manufactured efficiently and at a low cost.
By End-Use
Based on industry, the market is segmented into aerospace & defense, automotive, consumer electronics, healthcare, heavy industrial manufacturing, and IT & telecommunication. The IT and telecommunication industry accounted for the largest market share by revenue in 2022. The growth of IT & telecommunication industry is attributed to the increasing adoption of cloud computing, advancements in Internet of Things (IoT), and rise of 5G networks. Technologies such as the internet of things (IoT) are increasing the demand for innovative and reliable electronic products and systems leading to the growth of the EMS market. For instance, in April 2022, Viking Enterprise Solutions (Sanmina Corporation) launched a Cloud Native Obsidian (CNO) solution. The solution is specifically designed to provide companies operating in the IT industry with a highly scalable and cost-effective storage option.
The automotive industry is expected to grow with the fastest CAGR in the forecast period due to the increasing adoption of electric vehicles. Electric vehicles have more complex electrical systems compared to traditional gasoline-powered vehicles, which require specialized expertise in the design, manufacturing, and testing of these systems. EMS providers are able to offer their expertise in developing complex electronic systems for electric vehicles, including battery management systems, electric motors, and power electronics.
By Region
Asia-Pacific region accounted for the largest share of the electronic manufacturing services market. Countries such as China, Taiwan, and South Korea, have become major manufacturing hubs for electronics because of which EMS providers have gained popularity in this region. Moreover, governments in the Asia-Pacific region have implemented policies and initiatives to attract investments in their electronics industries. For instance, in July 2021, the Indian government approved 14 companies under the production-linked incentive (PLI) scheme for IT hardware. The PLI scheme aims to boost local manufacturing and attract investment in the Indian electronics industry.
North America is anticipated to witness significant growth during the forecast period. North American region is home to major technology companies like Apple and Microsoft, which necessitate high-quality, customized EMS solutions to cater to their specific needs and remain competitive in the market. As a result, the EMS market in North America is anticipated to grow significantly during the forecast period.
Electronic Manufacturing Services (EMS) Market Competitive Landscape:
The market for electronic manufacturing (EMS) is highly competitive owing to a number of vendors providing services to the international and domestic markets. The key market players are adopting strategies for mergers and acquisitions, and product innovations to stay competitive in the market. Following are the major market players that comprise the latest market concentrationâ€\"
• Sanmina Corporation
• Hon Hai Precision Industry Co. Ltd (Foxconn)
• Benchmark Electronics Inc.
• Flex Ltd
• Jabil Inc.
• Celestica Inc.
• Wistron Corporation
• Plexus Corporation
• Fabrinet
• COMPAL Inc.
Recent Developments
• In October 2022, Rockwell Automation signed an agreement acquire CUBIC, a leading provider of industrial automation and power management solutions. The acquisition will enhance Rockwell Automations portfolio of low-voltage electrical components.
• In June 2022, Flex Ltd. announced the expansion of its regional strategic automotive manufacturing hub in Jalisco, Mexico. The expansion is aimed at enabling the development and production of next-generation mobility solutions, including electric vehicles and autonomous driving technologies.
Electronic Manufacturing Services (EMS) Market is estimated to reach over USD 1,037.25 Million by 2030 from a value of USD 510.12 Million in 2022, growing at a CAGR of 8.90% from 2023 to 2030.
Electronic Manufacturing Services (EMS) are a type of outsourcing service, including a range of services offered by companies that design, manufacture, test, and repair electronic products. The EMS providers are responsible for all aspects of the production process including sourcing raw materials & components, designing & testing the product, and assembling & delivering the finished product. EMS providers are focused on delivering high-quality products to ensure product reliability and conformity to industry standards.
The rapid growth of the consumer electronics industry, fueled by the increasing popularity of smartphones, laptops, and wearable technology is driving the demand for EMS services. Companies are increasingly outsourcing their electronics manufacturing operations to EMS providers in order to focus on their core competencies, which in turn is fueling the adoption of electronics manufacturing services. For instance, in March 2022, Sanmina Corporation and Reliance Industries Limited completed a deal to set up a joint venture for electronics manufacturing services in India. The goal of the joint venture is to bring together Sanminas expertise in electronics manufacturing and Reliances experience in creating world-class manufacturing infrastructure in India.
Electronic Manufacturing Services (EMS) Market Coverage
| Report Attributes | Report Details |
| Study Timeline | 2017-2030 |
| Market Size in 2030 (USD Million) | 1037.25 |
| CAGR (2023-2030) | 8.9 % |
| Base Year | 2022 |
| By Service | Electronics Manufacturing Services, Engineering Services, Logistics Services, Test & Development Implementation, and Others |
| By End Use | Aerospace & Defense, Automotive, Consumer Electronics, Healthcare, Heavy Industrial Manufacturing, and IT & Telecommunication |
| By Geography | |
| Key Players | Sanmina Corporation, Hon Hai Precision Industry Co. Ltd (Foxconn), Benchmark Electronics Inc., Flex Ltd, Jabil Inc., Celestica Inc., Wistron Corporation, Plexus Corporation, Fabrinet, COMPAL Inc. |
Market Dynamics:
Driver:
Increasing dependence on EMS providers to reduce manufacturing costs is driving the market growth. Original equipment manufacturers (OEMs) are increasingly outsourcing their manufacturing operations to EMS providers as it allows them to reduce their overhead costs, including labor, equipment, and inventory. The EMS providers have the expertise and resources to invest in the latest technologies such as 3-D printing, robotics & automation, and digital manufacturing which helps companies to fasten the product development process. Therefore, partnerships with EMS providers help companies such as Apple Inc., General Electric (GE) to reduce costs associated with electronic manufacturing which is driving the growth of the electronic manufacturing services market. For instance, Apple outsources the manufacturing of its iPhones and other electronic devices to EMS providers including Foxconn and Pegatron.
Restraint:
Intellectual property (IP) rights are crucial for providing secure legal protection to innovative creations, giving businesses a competitive edge. Violating these rights not only breaches the innovators and investors privacy policies but also hinders economic growth. Failure to address IP rights violations is expected to impede market growth and limit business opportunities.
Opportunities
The rising adoption of electric vehicles provides lucrative growth opportunities for the electronic manufacturing services (EMS) market during the upcoming period. The surge in production of electric vehicles is leading to an increase in demand for advanced electronics including batteries, power electronics, and control systems. Additionally, the EMS companies play a crucial role in providing the required manufacturing and engineering services to support the development of these advanced electronics. Furthermore, the development of electric vehicle charging infrastructure is also expected to create new opportunities for EMS companies to provide services such as design and installation of charging stations.
Point of Sale (PoS) Market Segmentation:
By Service
Based on service, the market is segregated into electronics manufacturing services, engineering services, logistics services, test & development implementation, and others. The electronic manufacturing segment dominates the global market due to increasing consumer\\\'s demand for customized electronic products. Companies are increasingly seeking the services of EMS providers to aid in the design and manufacturing of products that fulfill the unique requirements of their customers. For instance, in October 2022, Celestica launched DS1000 Ethernet switch, a compact, cost-effective, resilient, and open network switch for data centers and enterprise deployments.
Engineering services are expected to register a highest CAGR during the forecast period owing to the increasing complexity of electronic products. The growing complexity of products demands specialized expertise for their design and development. EMS providers that offer engineering services help clients to design and develop products that meet specific requirements, while also ensuring that the products are manufactured efficiently and at a low cost.
By End-Use
Based on industry, the market is segmented into aerospace & defense, automotive, consumer electronics, healthcare, heavy industrial manufacturing, and IT & telecommunication. The IT and telecommunication industry accounted for the largest market share by revenue in 2022. The growth of IT & telecommunication industry is attributed to the increasing adoption of cloud computing, advancements in Internet of Things (IoT), and rise of 5G networks. Technologies such as the internet of things (IoT) are increasing the demand for innovative and reliable electronic products and systems leading to the growth of the EMS market. For instance, in April 2022, Viking Enterprise Solutions (Sanmina Corporation) launched a Cloud Native Obsidian (CNO) solution. The solution is specifically designed to provide companies operating in the IT industry with a highly scalable and cost-effective storage option.
The automotive industry is expected to grow with the fastest CAGR in the forecast period due to the increasing adoption of electric vehicles. Electric vehicles have more complex electrical systems compared to traditional gasoline-powered vehicles, which require specialized expertise in the design, manufacturing, and testing of these systems. EMS providers are able to offer their expertise in developing complex electronic systems for electric vehicles, including battery management systems, electric motors, and power electronics.
By Region
Asia-Pacific region accounted for the largest share of the electronic manufacturing services market. Countries such as China, Taiwan, and South Korea, have become major manufacturing hubs for electronics because of which EMS providers have gained popularity in this region. Moreover, governments in the Asia-Pacific region have implemented policies and initiatives to attract investments in their electronics industries. For instance, in July 2021, the Indian government approved 14 companies under the production-linked incentive (PLI) scheme for IT hardware. The PLI scheme aims to boost local manufacturing and attract investment in the Indian electronics industry.
North America is anticipated to witness significant growth during the forecast period. North American region is home to major technology companies like Apple and Microsoft, which necessitate high-quality, customized EMS solutions to cater to their specific needs and remain competitive in the market. As a result, the EMS market in North America is anticipated to grow significantly during the forecast period.
Electronic Manufacturing Services (EMS) Market Competitive Landscape:
The market for electronic manufacturing (EMS) is highly competitive owing to a number of vendors providing services to the international and domestic markets. The key market players are adopting strategies for mergers and acquisitions, and product innovations to stay competitive in the market. Following are the major market players that comprise the latest market concentrationâ€\"
• Sanmina Corporation
• Hon Hai Precision Industry Co. Ltd (Foxconn)
• Benchmark Electronics Inc.
• Flex Ltd
• Jabil Inc.
• Celestica Inc.
• Wistron Corporation
• Plexus Corporation
• Fabrinet
• COMPAL Inc.
Recent Developments
• In October 2022, Rockwell Automation signed an agreement acquire CUBIC, a leading provider of industrial automation and power management solutions. The acquisition will enhance Rockwell Automations portfolio of low-voltage electrical components.
• In June 2022, Flex Ltd. announced the expansion of its regional strategic automotive manufacturing hub in Jalisco, Mexico. The expansion is aimed at enabling the development and production of next-generation mobility solutions, including electric vehicles and autonomous driving technologies.
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