GVR Report cover Europe Electronic Contract Manufacturing And Design Services Market Size, Share & Trends Report

Europe Electronic Contract Manufacturing And Design Services Market Size, Share & Trends Analysis Report By End-use (IT & Telecom, Industrial, Healthcare, Consumer Electronics), By Country, And Segment Forecasts, 2021 - 2028

  • Published Date: Sep, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-4-68039-542-8
  • Format: Electronic (PDF)
  • Historical Data: 2018 - 2019
  • Number of Pages: 100

Report Overview

The Europe electronic contract manufacturing and design services market size was valued at USD 40.31 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 7.1% from 2021 to 2028. The growth of the market can be attributed to the continued adoption of work-from-home and remote working practices, which has gained traction in the wake of the outbreak of the COVID-19 pandemic and has triggered the demand for high-end servers, storage devices, switches, routers, and other computing devices. The growth can also be attributed to the fact that remote working and work-from-home trends are expected to evolve as a new norm over the next few years. The strong emphasis Original Equipment Manufacturers (OEMs) are putting on outsourcing electronics manufacturing to focus more on their core competencies is also expected to emerge as a long-term factor contributing to the market growth over the forecast period.

U.K. electronic contract manufacturing and design services market size, by end-use, 2018 - 2028 (USD Billion)

The outbreak of the COVID-19 pandemic prompted several governments in Europe to impose lockdowns and restrictions on the movement of people and goods as part of the efforts to arrest the spread of coronavirus. However, supply chains got disrupted severely and manufacturing activities were suspended temporarily at several production facilities as a result of these measures, thereby leading to production delays. Nevertheless, order backlogs and sales to new customers in eastern European countries, notably Sweden, Finland, the Netherlands, and Denmark, gradually aided in a market recovery. As a result, the slump in sales noted in H1/2020 as a result of the outbreak of the pandemic was partially offset in H2/2020.

The rising preference for localized supply chains and the need for a highly efficient manufacturing process bodes well for the growth of the market. Electronic Manufacturing Services (EMS) vendors can manufacture electronics products at a reduced total cost to OEMs. EMS companies can particularly manufacture customized products on a large scale while focusing on reducing the manufacturing costs leveraging higher capacity utilization. EMS vendors are also integrating the latest technologies, such as AI and 3D digital printing, into their production processes as part of the efforts to reduce their capital investment in inventory, facilities, and equipment used in manufacturing. Such strategic initiatives being pursued by EMS vendors are expected to encourage OEMs to consider outsourcing electronics manufacturing to EMS vendors and focus on their core competencies.

The continued adoption of cloud computing infrastructure and rollout of smart city projects coupled with the rising popularity of smart homes are some of the other factors that are expected to contribute to the growth of the market. Vendors are aggressively adopting big data and implementing predictive maintenance technologies in all the areas of EMS. Internet of things (IoT) can play a crucial role in predictive technology and big data by aiding in collecting, processing, and analyzing data in real time, thereby helping in increasing productivity and efficiency. Predictive maintenance envisages linking factories through the internet to monitor and control processes remotely using mobile devices or personal computers. Predictive maintenance helps EMS vendors in accelerating production, gaining greater control over the quality, and reducing costs. The proliferation of IoT networks is driving the demand for highly efficient smart applications and devices, thereby paving the way for the growth of the Europe electronic contract manufacturing (ECM) and design services market.

The strong emphasis on reducing the time to market is anticipated to drive the growth of the market over the forecast period. The time the product takes to reach the OEMs’ facilities from the EMS providers’ facilities is turning out to be a major concern for the OEMs. As a result, OEMs are particularly hesitant to deal with EMS providers located at longer distances. Hence, EMS providers are exploring the alternative of micro-logistics to meet the OEMs’ demands for accelerated delivery and are investing aggressively in improving their logistics to ensure timely delivery of products.

End-use Insights

The industrial segment accounted for the largest market share of over 25% in 2020. The growing adoption of industrial robotics has triggered the need for miniaturized electronic components, thereby driving the need for specialized expertise in electronics manufacturing. At this juncture, the pricing pressure OEMs are increasingly confronting is prompting them to consider outsourcing electronics manufacturing. Advances in the Industrial Internet of Things (IIoT) and telecommunications are also driving the need among the OEMs to approach EMS vendors.

Europe electronic contract manufacturing and design services market share, by end-use, 2020 (%)

The healthcare segment is anticipated to expand at the highest CAGR exceeding 9% over the forecast period. The growth of the segment can be attributed to the rising demand for advanced medical devices, including Computed Tomography (CT) scanner assemblies, ultrasound imaging systems, and blood analyzers. The increasing geriatric population in European countries, such as Italy, Greece, and Portugal, is typically driving the demand for ambient assisted devices. The high costs associated with the manufacturing of these devices are prompting healthcare OEMs to opt for contract manufacturing. The rising demand for patient care devices and sophisticated diagnostics devices, particularly in the wake of the outbreak of the COVID-19 pandemic, also bodes well for the growth of the market over the forecast period.

Regional Insights

Germany accounted for the second-largest market share exceeding 20% in 2020. The continued innovation, primarily in the IT and telecom, and automotive industries, has been driving the growth of the electronic manufacturing and design services market in Germany. The increasing popularity of intelligent transport systems, such as connected cars, which can provide real-time information about traffic and weather conditions are expected to drive the demand for electronics manufacturing services over the forecast period. Strategic collaborations aimed at inculcating sophisticated technologies and advancing the existing technologies are also expected to drive the growth of the EMS market in Germany over the forecast period.

The U.K was ranked third in the Europe electronics contract manufacturing and design services market. The electronics manufacturing and design services market in the U.K. is expected to expand at a CAGR exceeding 20% over the forecast period. The growing reliance on outsourcing electronics manufacturing to EMS vendors is expected to emerge as a long-term trend in the U.K. Outsourcing to electronics manufacturing to EMS vendors allows the OEMs to focus on their core competencies and expand their customer base. The outbreak of the pandemic has particularly triggered the demand for wearable devices, such as fitness bands, among individuals to monitor and track various health parameters, such as body temperature, blood pressure, respiratory rate, and sleep patterns. Aggressive investments in new manufacturing technologies are also anticipated to open new opportunities for EMS companies to attract new customers and augment their revenues. For instance, Chemigraphic Ltd, an EMS provider based in the U.K., implements camera-based system verification, X-rays, or automatic optical inspection (AOI) technology to validate the placement of materials while manufacturing healthcare devices.

Key Companies & Market Share Insights

The market can be described as a highly fragmented market dominated by some of the globally recognized companies, including Hon Hai Precision Industry Co., Ltd (Foxconn Technology Group); Jabil Inc.; Flex Ltd; Zollner Elektronik; and VIDEOTON HOLDING ZRt. However, these companies are encountering intense competition from small companies, which are trying aggressively to gain a considerable share in the market. At this juncture, market players are putting a strong emphasis on adopting the latest, advanced technologies, such as AI, factory automation, and robotics, as part of the efforts to offer enhanced electronics manufacturing services to their customers.

On the other hand, a looming threat from Chinese EMS vendors is driving consolidation in the market. For instance, in December 2020, USI, a semiconductor manufacturing services company based in China, acquired Asteelflash Group, one of the leading providers of ECM and design services. USI envisaged leveraging the acquisition to strengthen its presence in Europe. Some of the prominent players operating in the Europe electronic contract manufacturing and design services market are:

  • Cicor Management AG

  • Enis

  • Flex Ltd

  • Hon Hai Precision Industry Co., Ltd (Foxconn Technology Group)

  • Jabil Inc.

  • Kitron ASA

  • Neways

  • NORBIT ASA

  • NOTE AB

  • Sanmina Corporation

  • Scanfil

  • USI

  • VIDEOTON HOLDING ZRt

  • Zollner Elektronik

Europe Electronic Contract Manufacturing And Design Services Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 42.46 billion

Revenue forecast in 2028

USD 68.61 billion

Growth rate

CAGR of 7.1% from 2021 to 2028

Base year for estimation

2020

Historical data

2018 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company share, competitive landscape, growth factors, and trends

Segments covered

End-use, country

Regional scope

Europe

Country scope

U.K.; Germany; Rest of Europe

Key companies profiled

Cicor Management AG; Flex Ltd; Hon Hai Precision Industry Co., Ltd (Foxconn Technology Group); Jabil Inc.; Kitron ASA; Neways

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country and segment scope

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options

 

Segments Covered in the Report

This report forecasts revenue growth at the regional and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2028. For this study, Grand View Research has segmented the Europe electronic contract manufacturing and design services market report based on end-use and region:

  • End-use Outlook (Revenue, USD Billion, 2018 - 2028)

    • Healthcare

    • Automotive

    • Industrial

    • Aerospace & Defense

    • IT & Telecom

    • Power & Energy

    • Consumer Electronics

    • Others

  • Regional Outlook (Revenue, USD Billion, 2018 - 2028)

    • U.K

    • Germany

    • Rest of Europe

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