Electronic Manufacturing Services
Market, Supplier, Risk and
Competitive Intelligence

Electronic Manufacturing Services - Global Drivers and Constraints

Electronic Manufacturing Services (EMS) Market Trends

Rising Trend of Smart Home 

The increasing adoption of smart home devices in developed regions such as the US are setting high hopes for electronic manufacturing service vendors. In the US, the electronic manufacturing services delivered by the companies contain developing optoelectronics services, radio frequency (RF) & wireless devices, and microelectronics devices for the rapidly emerging smart home trend.

 Market players are focusing on stepping up their production capacities by integrating cloud computing, artificial intelligence (AI), big data analysis, and 3D printing to manufacture connected devices for smart homes.  

Greater Emphasis on Vehicle Electrification

The expansion of EVs owing to rising stringency in  government policies to curb carbon footprint will influence automakers to opt for electronic manufacturing services. Also, governments across the world are launching schemes and policies to promote the adoption of EVs. 

 The EMS expertise in the automotive sector includes box build assembly, PCB assembly services, and module assembly to provide high-volume production units to OEMs. Industry players are creating long-term collaborations with tier-1 suppliers and prominent automakers.

A significant demand for communication and automotive electronics has been one of the key driving factors for EMS growth globally. Severe price competition due to significant fragmentation is expected to shrink the profit margins of the manufacturers.

Drivers

• Downstream Demand

Increasing demand from downstream industries is expected to be the primary driver for the increase in global CEM/EMS industry

• Technological Advancements

Development of new manufacturing technologies and upcoming end-use segments, such as the Internet of Things (IoT), is expected to boost the demand for the EMS market. Major manufacturers are increasing their spending on R&D to differentiate their products and attract new end-use applications.

Constraints

• Regulations & Violation of IP

 Compliance with domestic stringent regulations and trade tariffs is impacting the EMS industry and forcing OEMs to build in house manufacturing capabilities. Also, increasing case of violation of Intellectual Property Rights (IP) is significantly impacting the Contract manufacturers

• Industry Profit Margins

High competition among EMS providers leads to low-profit margins within the industry. This restricts the growth of smaller manufacturers, especially in emerging markets. Such suppliers typically compete on price terms, which affects the quality of the products they manufacture

Industry Events

The EMS industry has witnessed continuous and strategic growth, due to which various industry events take place, in order to sustain the growth. Some of the major industry events include mergers and acquisitions, capacity additions, exhibitions and trade conferences, and technology-driven manufacturing

Plant Expansion

TKR Corp., the EMS business of Nippon Manufacturing Services, has expanded their production facilities in Vietnam, as the need for local production for local consumption is increasing, with a growing necessity to enhance production in the ASEAN region

M&A

TT Electronics Plc has completed its acquisition of Stadium Group plc, a supplier of design-led technologies with product capabilities

Components Shortages

The increasing shortfall in the supply of passive components has disrupted production at some major EMS firms in Taiwan. This has affected the supply to brand clients, with consumers facing possible price hikes in end markets

Service Expansion

Sanmina Corporation says that it has received FDA registration at its manufacturing facilities in Chennai (India) enabling it to manufacture finished medical instruments and devices in the country.

The EMS company has also announced capacity expansion in Thailand, which will have leading-edge customized packaging and assembly capabilities to develop innovative high-speed, optical, and radio frequency (RF) microelectronic products.

Closure

Zytek EMS, a contract electronics assembler, located in Silicon Valley, is closing its factory and selling its assets at auction

Why should you Buy this Report

The report on the electronic manufacturing services market discusses the regional market overview constituting market size, growth rate and key suppliers in the US, Canada, LATAM, EMEA, and APAC. Also, it highlights Porter's Five Force Analysis including the supplier power, buyer power, barriers to new entrants, intensity of rivalry and threat of substitute. 

Comprehensive analysis of market drivers and constraints, cost and pricing forecast as well as the impact of key price drivers have been included. The research study scrutinizes key global suppliers' profiles and offers a SWOT analysis of some of the major industry giants including Foxconn, Pegatron, Flextronics, Jabil Inc., and Sanmina. Furthermore, the electronic manufacturing service market study covers procurement best practices such as sourcing strategy, engagement models, contract models, and risk analysis.