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As OEMs Streamline Operations, ECMs Should Strive to Become “One-Stop Solution Provider,” According to BCC Research
  • USA - English


News provided by

BCC Research

Jul 16, 2015, 09:30 ET

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Wellesley, Mass. (PRWEB) July 16, 2015 -- Electronics contract manufacturing (ECM) has become the backbone of computer and electronics production globally, providing essential design, manufacturing and assembly services to original equipment manufacturers (OEMs). BCC Research reveals in its new report that the responsibilities of ECMs will only continue to grow as OEMs streamline their organizations into profit design centers and increasingly expand their use of contract manufacturers.

The global market for electronics contract manufacturing (ECM) services is expected to reach $845.8 billion by 2021

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The global ECM market is expected to grow from nearly $561.2 billion in 2016 to $845.8 billion in 2021, reflecting a five-year compound annual growth rate (CAGR) of 8.6%. China and Taiwan are expected to continue their domination of the global ECM market, while new dominant players will emerge from Southeast Asian countries, including India, Singapore, Malaysia, Thailand and Vietnam.

Computers and peripherals dominated the electronics contract manufacturing industry during the last two decades, totaling about 40% of the total output of contract manufacturers in 2013. However, this trend changed in 2014 with the growing popularity of smartphones and tablets. Telecommunications applications, the second largest segment of the market, should maintain steady growth during the forecast period, as should consumer electronics, the third largest ECM segment.

The boundaries of electronics firms are changing, with many multinational OEMs focusing on core competencies such as engineering and design and selling off part of their manufacturing capacity. Some ECM companies headquartered in developed countries have moved the production and assembly of labor-intensive electronic components to developing countries, chiefly Asia, to leverage lower wages. Thus, Asia has become a global electronics manufacturing hub, spurring employment and economic growth. That continent’s share of global electronics production rose from 6% in 1985 to more than 65% in 2014.

Overall, the ECM services market is growing and becoming more competitive. Modern contract manufacturers are now involved in every aspect of an OEM’s product, from concept design to customer delivery.

“The expectation is that the ECM will build complete electronic assemblies, which are designed and manufactured to meet performance specifications and reliability expectations, and to perform within product life expectancies,” says BCC research analyst Srinivasa Rajaram. “These new demands on ECMs require a new business model and philosophy, and the ECM of the future must be able to maintain tremendous flexibility. The future is bright for ECMs that embrace change and are willing to turn themselves into solution providers that add value with services and expertise to ensure customer-designed products meet end-use expectations in the marketplace.”

Electronics Contract Manufacturing and Design Services: The Global Market (MFG021C) examines the global markets for electronics contract manufacturing services with estimates for 2015 and 2016 and CAGR projections through 2021.

Editors and reporters who wish to speak with the analyst should contact Steven Cumming at steven.cumming(AT)bccresearch.com.

About BCC Research
BCC Research publishes market research reports that make organizations worldwide more profitable with intelligence that drives smart business decisions. These reports cover today's major industrial and technology sectors, including emerging markets. For more than 40 years we've helped customers identify new market opportunities with accurate and reliable data and insight, including market sizing, forecasting, industry overviews, and identification of significant trends and key market participants. We partner with analysts who are experts in specific areas of industry and technology, providing unbiased measurements and assessments of global markets. Recently selected as the world’s greatest market research company, BCC Research is a unit of Eli Global, LLC. Visit our website at http://www.bccresearch.com. Contact us: (+1) 781-489-7301 (U.S. Eastern Time), or email information(AT)bccresearch.com.

Steven Cumming, BCC Research, http://www.bccresearch.com, +1 (781) 489-7301 Ext: 632, [email protected]

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