Plastic Contract Manufacturing Market Report

Plastic Contract Manufacturing Market Analysis By Product (Polypropylene, ABS, Polyethylene, Polystyrene), By Application (Medical, Aerospace & Defense, Automotive), By Region, And Segment Forecasts, 2014 - 2025

Published: August 2017  |  108 Pages  |  Format: PDF  |  Report ID: GVR-1-68038-968-5

Industry Insights

The global plastic contract manufacturing market size was worth USD 23.30 billion in 2016. Growing demand for consumer electronics including smartphones, televisions, computers, laptops, video recorders, and cameras is expected to have a positive impact on the market over the forecast period. 

Consumer electronics industry is dynamic and highly competitive in nature. As a result, manufacturers have been trying to implement methods which can reduce production cost and cater to the changing consumer demands. Plastic contract manufacturing facilitates production of the components in less time and enhances the supply chain efficiency of the manufacturer, which is likely to propel the demand over the forecast period.

U.S. plastic contract manufacturing market revenue, by product, 2014 - 2025 (USD Billion)

U.S. plastic contract manufacturing market

Plastics including polyethylene (PE), polyvinylchloride (PVC), polypropylene (PP), and engineering plastics are increasingly being used in the manufacturing of medical devices. The growth of home healthcare market on account of low costs as compared to hospital and intensive care has resulted in a rise in demand for medical devices. In addition, numerous tests conducted for diagnosis have also contributed to the increasing demand for medical devices, thereby propelling the market growth.

Companies adopting contract manufacturing do not have to invest on the new manufacturing facility, tools & machinery, and training of the staff, which leads to cost saving. In addition, high level of expertise and technical know-how of the contract manufacturers enables the development of high-quality products.

The contract manufacturing system works on the demand flow basis. Hence, contract manufacturers work with OEM planners to level out the changes in demand, thereby leading to steady production and efficient supply chain management. This also leads to increased focus of OEMs on other aspects of the business including sales, strategic planning, R&D, marketing, and customer service.

Genesis Plastics Welding, C&J Industries, McClarin Plastics, LLC, EVCO Plastics, GW Plastics, Mack Molding, Gregstrom Corporation, Permian Plastics, and Coarc Manufacturing are some of the major plastic contract manufacturing companies. These manufacturers work with OEMs from various industries including medical, military, automotive, telecommunication, agriculture, and consumer products for developing plastic products with high tensile strength, abrasion resistance, tear strength, and oil resistance.

Product Insights

Polypropylene (PP) was the major segment accounting for a share of 34.1% in 2016. Polypropylene is one of the majorly used raw materials for manufacturing components in medical, automotive, and consumer product applications. The properties of polypropylene including sterilization and impact resistance are expected to propel its utilization in medical industry. 

Polypropylene is also used in various consumer products including toiletries and cosmetics. High adoption rate and low cost of PP is expected to have a positive impact on the demand over the forecast period.

Polyethylene is anticipated to witness a significant growth of 5.9% from 2017 to 2025 on account of rising demand from emerging economies, particularly China and India. High ductility & moisture resistance and low cost of the polyethylene has led to its high demand for electrical instruments, hot water pipes, and car components.

High degree of sterilization achieved through the use of HDPE is expected to augment its utilization in medical industry. In addition, ease of disposability of the product is expected to drive the market growth further.

Application Insights

Consumer goods & appliances was the major application in 2016 and is expected to grow at a CAGR of 6.1% from 2017 to 2025. The growing demand for electronic gadgets such as smartphones and wearables coupled with rising disposable income are likely to be the key factors driving the industry growth.

The major plastics used for manufacturing consumer goods & appliances include ABS-ASA-SAN, polypropylene, polystyrene, polyurethane, and polyethylene. Garage door openers, paint brush handles, electric toothbrushes, outdoor grills, HD DLP, Plasma and LCD television frames and panels, gardening products, pet care, sporting goods, personal care products, etc. are some of the products manufactured by the market players catering to this application.

Global plastic contract manufacturing market, by application, 2016 (%)

Global plastic contract manufacturing market

Medical is projected to be the fastest growing application and is anticipated to witness a CAGR of 6.5% from 2017 to 2025. Growing complexities in engineering and design of the products coupled with a rise in number of surgeries have led to increase in the demand for medical devices. This is expected to play a key role in augmenting the industry growth over the forecast period.

Medical device manufacturing involves high costs and intense competition among the market players. This leads to increase in the adoption of ways which can reduce the cost of production. In addition, changing material requirement and technology for production of medical devices is expected to have a positive impact on the market over the coming years.

Regional Insights

Asia Pacific was the leading market and accounted for 42.4% of the total revenue in 2016. Asia Pacific is the largest manufacturer as well as consumer of plastics worldwide. It is also one of the major producers of household appliances. Rising disposable income and increasing population in the region has resulted in a high domestic demand for electronic appliances, which is likely to propel the market over the next eight years.

Abundant raw material availability, cheap labor cost, land availability, and high domestic demand are the key factors influencing the manufacturing sector in Asia Pacific. These aforementioned factors are luring foreign manufacturers to invest in the manufacturing sector in the region, thereby augmenting growth.

Central & South America is anticipated to witness a CAGR of 5.7% from 2017 to 2025. Rising manufacturing sector in economies including Brazil, Colombia, Venezuela, and Argentina is expected to positively affect the demand. Moreover, rising healthcare investment is likely to fuel the growth further.

MEA is anticipated to witness sluggish growth on account of the presence of limited companies and lack of raw material. However, supportive government regulations have resulted in the growth of the aerospace sector, thereby developing huge opportunities for the market.

Competitive Insights

Plastic contract manufacturing market is characterized by the presence of numerous manufacturers across the world. The market players cater to the demand from applications including medical, automotive, aerospace & defense, consumer goods & appliances, telecommunication, industrial, agriculture, etc. 

The market players have been trying to offer better value added services in order to increase their customer base. In addition, companies have been expanding in the emerging economies to increase their global reach.

Report Scope 

Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2016

Forecast period

2017 - 2025

Market representation

Revenue in USD Million and CAGR from 2017 to 2025

Regional scope

North America, Europe, Asia Pacific, Central & South America, Middle East & Africa

Country scope

U.S., Germany, UK, China, India, Japan, Brazil

Report coverage

Revenue forecast, competitive landscape, growth factors and trends

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Segments covered in the report

This report forecasts revenue growth at global, regional & country levels and provides an analysis on the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global plastic contract manufacturing market on the basis of product, application, and region: 

  • Product Outlook (Revenue, USD Million, 2014 - 2025)

    • Polypropylene

    • ABS

    • Polyethylene

    • Polystyrene

    • Others

  • Application Outlook (Revenue, USD Million, 2014 - 2025)

    • Medical

    • Aerospace & defense

    • Automotive

    • Consumer Goods and appliances

    • Others

  • Regional Outlook (Revenue, USD Million, 2014 - 2025)

    • North America

      • U.S.

    • Europe

      • Germany

      • UK

    • Asia Pacific

      • China

      • India

      • Japan

    • Central & South America

      • Brazil

    • Middle East & Africa
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