Market Insight-Global EMS and ODM Market Overview 2021
Global EMS and ODM market is projected to witness a compound annual growth rate of 4.39% to grow to US$ 766.59 billion by 2027, from US$ 566.93 billion in 2020.– Bossonresearch.com
Electronics Manufacturing Services (EMS) is a term used for companies that test, manufacture, distribute, and provide return/repair services for electronic components and assemblies for original equipment manufacturers (OEMs). The concept is also referred to as electronics contract manufacturing (ECM). An Original Design Manufacturer (ODM) is a company that designs and manufactures a product as specified and eventually rebranded by another firm for sale. Such companies allow the firm that owns or licenses the Company to produce products (either as a supplement or solely) without having to engage in the organization or running of a factory.
According to Bosson Research, The EMS and ODM market is projected to witness a compound annual growth rate of 4.39% to grow to US$ 766.59 billion by 2027, from US$ 566.93 billion in 2020. The market is expected to surge in the coming years due to the rise in the number of electric vehicles, cost reduction in the manufacturing process, and increasing investments in R&D. With the increasing innovation and advancement of emerging technologies, such as 5G and the IoT, electronic component manufacturing and designing had been revolutionized. There has been a surge in the demand for electronics manufacturing services in the consumer electronics industry, because of its growing connectivity among its products, like gaming, audio, wearable, and virtual reality. The increasing investments in the semiconductor industry are expected to play a major role in the overall market growth.
Figure Global EMS and ODM Market Size
Source: Bossonresearch.com, 2022
COVID-19 Impact
The global electronics industry's supply chain has been severely affected by the COVID-19 pandemic. The halt and delay in the raw materials required for automotive and communication electronics have negatively affected the market. According to the latest surveys conducted by the Organization for Economic Co-operation and Development (OECD), in March and April 2020, 43% of global electronics manufacturers and suppliers are negatively affected due to the effect of the coronavirus.
The pandemic hampered the sector's overall development in 2020, as major automakers including Fiat, Volkswagen, PSA Group, General Motors, and BMW had to halt production due to COVID-19 during the first two quarters of the year. In the first two quarters of 2020, businesses experienced supply chain delays as a result of stringent lockdowns imposed in many parts of the world. This scenario has an impact on the global EMS market, especially in European and North American countries, since the growth of this market is associated with the demand for electronics in developed economies. However, seeing 2021 as the turnaround time, when the automotive sector is projected to display growth, industry analysts predict that the demand for electronic manufacturing services will increase.
The escalating trade war between China and the United States has prompted many Asian factories to relocate their operations from China to Southeast Asian countries in order to escape tariffs. According to the Thailand Development Research Institute (TDRI), the majority of companies have relocated their manufacturing plants to Vietnam because of its low labor costs and high-tech industries. However, as a result of the COVID-19 pandemic, the demand for computers and laptops has increased, driving the competition for electronic manufacturing services in computer applications in the longer term.
Regional Insights
In terms of geography, the market is segmented into North America, Europe, Asia Pacific, the Middle East & Africa, and South America.
In 2020, the Asia Pacific region accounted for the largest electronic manufacturing services market share and it is projected to continue to expand significantly throughout the forecast period. Due to its strong presence in the consumer electronics, semiconductor-market and other telecommunications products and machinery manufacturing sectors, China is one of the most important markets for EMS in the world. The country manufactures and assembles approximately 60-70% of the world's electronics. Semiconductor revenues in the country grew from USD 82.4 billion in 2015 to USD 143.7 billion in 2019, according to the Semiconductor Industry Association (SIA). China also leads the world in 5G technologies, with 50 cities expected to have complete coverage by late 2020. The region's emphasis on improving telecommunications and navigation equipment is creating prospects for the market's vendors. Government-owned orbital robotic spy systems, as well as advancements in radar and optical imaging variants, are further driving the market growth.
The Europe electronics manufacturing services market is expected to witness strong growth. For PCBA assembly, research, prototyping, and construction, major European automotive manufacturers such as Volkswagen, BMW, and Renault are partnering with electronic manufacturing service providers. For example, Fiat Chrysler Automobiles (FCA) and Foxconn partnered for the production and construction of electric vehicles for the Chinese market in January 2020.
The North American market showcased strong growth in 2020 with great potential for future growth. The use of consumer electronics in middle- and high-income households is being driven by the region's rapid urbanization and steady population growth. The availability of low-cost consumer electronic devices, such as smartphones and televisions, from a variety of local brands, is assisting in their acceptance by low-income people. The demand in this region is also being boosted by the youth’s understanding of upcoming technologies. North America’s effective financial position also enables it to invest in R& D activities heavily. The fast use of structural electronics in conductors, photovoltaic devices, and sensors in high-end cars and space vehicles can be due to the region's higher structural electronics penetration.
The growth of the Middle East and Africa and South American market is mainly propelled by vast R&D activities, the adoption of electric-vehicle-market, and the growth of consumer and automotive electronics. Furthermore, the growing adoption of IoT and 3D technologies across a variety of industries is also expected to boost the structural electronics demand over the forecast era. However, due to the small number of automotive electronics producers, global vendors have an excellent opportunity to focus on local demand, rendering the MEA and South America attractive to investors.
Global EMS and ODM Market: Competitive Landscape
As of 2020, the market for EMS and ODM is relatively fragmented with global and domestic players. The main market companies are as follows: HONHAI, Quanta, Pegatron, Flextronics, Compal, Wistron, Jabil, Inventec, Sanmina, Celestica, New KINPO, USI, Benchmark, Kaifa, PLEXUS, SIIX, Venture, Zollner and UMC.
The top10 EMS and ODM players have surpassed USD 370 billion in sales. HONHAI is the leading EMS and ODM provider in the world,which accounts for more than 28% of the total market in 2020.
Key players in the EMS and ODMics Market include:
HONHAI
Pegatron
Quanta
Compal
Jabil
Flextronics
Wistron
Inventec
Luxshare
Wingtech
BYD Electronics
Huaqin
New KINPO
Sanmina
Qisda Corporation
Celestica
USI
PLEXUS
Kaifa
Benchmark
Zollner
SIIX
Venture
Fabrinet
MiTAC
Longcheer
UMC
Request for more information
Click to view the full report TOC, figure and tables: https://bossonresearch.com/productinfo/1543509.html
About US:
Bosson Research (BSR) is a leading market research and consulting company, provides market intelligence, advisory service and market research reports for the automobile, electronics and semiconductor, and consumer good industry. The company assists its clients to strategize business policies and achieve sustainable growth in their respective market domain.
Bosson Research provides one-stop solution right from data collection to investment advice. The analysts at Bosson Research (BSR) dig out factors that help clients understand the significance and impact of market dynamics. Bosson Research (BSR) bring together the deepest intelligence across the widest set of capital-intensive industries and markets. By connecting data across variables, our analysts and industry specialists present our customers with a richer, highly integrated view of their world.
Contact US:
Tel: +86 400-166-9288
E-mail: sales@bossonresearch.com
