Telecom Electronics Manufacturing Services (EMS) Market is estimated at US$7.815 billion in 2020 growing at a CAGR of 12.13% to reach a market size of US$17.412 billion by 2027.
The primary growth factors for the market growth of the telecom electronics manufacturing industry include the rising demand for communication devices and the continuously evolving trend of wireless communication. The major telecom manufacturing services include the design and manufacturing of the electronic components used across the telecom industry. The rising trend of contract manufacturing or subcontracting in the telecom sector across the globe is also one of the key factors which are expected to positively impact the growth of the market throughout the forecast period.
Furthermore, the adoption of these services further enhances the manufacturing services as it reduces the lead time and further helps to reduce the time to market. It also helps to move towards the leading and most advanced manufacturing technologies with considerably fewer capital investments, which is also anticipated to boost the adoption of these services throughout the forecast period.
Moreover, the technological innovation in the telecom industry and rising investments by key telecom companies for the adoption of the latest technology and the provision of enhanced and highly efficient services to their customers are anticipated to propel growth opportunities for the manufacturers throughout the forecast period. The shifting focus of telecom manufacturers on the activities that are majorly attributed to providing high value-added to the customers is leading to the subtraction of activities where the core competencies are not required, which is also projected to positively impact the growth of the market during the next five years.
The economic growth of the major emerging economies, such as China and India, is leading to rising disposable income and a growing middle-class population. This, in turn, is boosting the demand for communication devices and efficient services, which is further expected to increase investments by telecom providers for the expansion of quality services and thereby anticipate the demand for these services.
Furthermore, continuous technology is leading to the adoption of service subcontracting as rapid innovations in products and services due to growing consumer requirements frequently lead to the manufacturers' decreased focus on core competencies. Furthermore, rising investments by major electronics companies in order to avail the manufacturing services in order to expand the production capacity on account of the growing market demand also show the potential for the growth of the market in the coming years. For instance, recently in 2020, Rohde & Schwarz, a German company dealing in the field of electronic, cybersecurity, radio monitoring and radiolocation, test equipment, broadcast & media, and radio communication entered into a partnership agreement with Benchmark Electronics Inc. a leading EMS, ODM, and OEM company as a global manufacturing partner to expand its manufacturing capacity and meet the growing demand of the products manufactured by the company by availing the manufacturing expertise of the company.
The rising internet penetration is anticipated to boost the market’s growth
The growing internet penetration coupled with rapid advancements in wireless technology is further expected to augment the demand for telecom infrastructure. The growing number of internet users globally is further leading to budding investments by the service providers for the development of faster and more advanced services in order to meet the requirements of the users by providing better services and gaining an advantage over other providers. For example, in 2008, only 22.959% of people worldwide used the internet; by 2020, this figure had risen to 59.9% (Source: The World Bank Group). A rising trend is expected in the coming years, which will further snowball the demand for fast and high-speed internet. As a result, investments in telecom infrastructure are expected to accelerate, contributing significantly to market growth
Booming investments in 5G technology are anticipated to propel the market growth opportunities.
As key market players invest heavily in order to gain a competitive advantage over others, emerging investments for the deployment of 5G technology are further leading to innovations in test technology. For instance, National Instruments, a provider of a software-defined platform for accelerating the performance of automated tests and measurement systems, announced its latest mmWave Test Solution in May 2019, to address the test challenges of the 5G mmWave and RFIC transceivers and amplifiers in order to accelerate the commercialization of 5G technology. Moreover, 5G is expected to operate on much higher frequencies, which is further anticipated to the adoption of new interface and component technologies, which may further positively impact the growth of the market.
The design and engineering segment is expected to grow significantly during the forecast period.
On the basis of services, the market has been segmented into design & engineering, manufacturing, assembly, testing, and others. The design and engineering segment is anticipated to show decent growth over the forecast period. The growth of this segment is majorly attributed to the rising investments in R&D by key market players due to rising consumer demand for efficient services.
North America is anticipated to hold a decent share of the market
Geographically, the global telecom electronics manufacturing services market has been segmented as follows: North America, South America, Europe, the Middle East, Africa, and the Asia Pacific. The North American region is expected to hold a noteworthy share in the market on account of its well-established infrastructure and the presence of a highly advanced telecom industry. The market in the Asia Pacific region is expected to show notable growth during the forecast period owing to burgeoning investments in the telecom industry coupled with rapidly increasing investments in 5G technology in countries like China and South Korea.
Recent development and expansions
The COVID-19 pandemic has impacted a variety of industries, including the telecom, electronics and technology sectors. The pandemic has also influenced buyer behaviour and attitudes. The government imposed stringent restrictions on import/export policies, disrupting the market's supply chain. These factors and constraints hampered customer production and supply of goods. During the pandemic, the companies' production and sales rates were reduced.
|Market Size Value in 2020||US$7.815 billion|
|Market Size Value in 2027||US$17.412 billion|
|Growth Rate||CAGR of 12.13% from 2020 to 2027|
|Forecast Unit (Value)||USD Billion|
|Segments Covered||Services, And Geography|
|Regions Covered||North America, South America, Europe, Middle East and Africa, Asia Pacific|
|Companies Covered||Benchmark, Flex Ltd. Flextronics International, LTD, Jabil Inc, Celestica Inc, Compal Inc, Sanmina Corporation|
|Customization Scope||Free report customization with purchase|
Frequently Asked Questions (FAQs)
Q1. What will be the telecom electronics manufacturing services market size by 2027?
A1. The global telecom electronics manufacturing services (EMS) market is estimated to reach a market size of US$17.412 billion by 2027.
Q2. What factors are anticipated to drive the telecom electronics manufacturing services market growth?
A2. The primary growth factors for the telecom electronics manufacturing services market growth include the rising demand for communication devices and the continuously evolving trend and the expansion of wireless communication.
Q3. What are the growth prospects for the telecom electronics manufacturing services market?
A3. The telecom electronics manufacturing services (EMS) market is estimated to grow at a CAGR of 12.13% during the forecast period.
Q4. What is the size of the telecom electronics manufacturing services market?
A4. Telecom Electronics Manufacturing Services Market was valued at US$7.815 billion in 2020.
Q5. Which region holds the largest share of the telecom electronics manufacturing services market?
A5. The North American region is expected to hold a noteworthy share in the telecom electronics manufacturing services market on account of its well-established infrastructure and the presence of a highly advanced telecom industry.
1.1. Market Overview
1.2. COVID-19 Scenario
1.3. Market Definition
1.4. Market Segmentation
2. RESEARCH METHODOLOGY
2.1. Research Data
3. EXECUTIVE SUMMARY
3.1. Research Highlights
4. MARKET DYNAMICS
4.1. Market Drivers
4.2. Market Restraints
4.3. Porter's Five Force Analysis
4.3.1. Bargaining Power of Suppliers
4.3.2. Bargaining Power of Buyers
4.3.3. Threat of New Entrants
4.3.4. Threat of Substitutes
4.3.5. Competitive Rivalry in the Industry
4.4. Industry Value Chain Analysis
5. TELECOM ELECTRONICS MANUFACTURING SERVICES MARKET BY SERVICES
5.2. Design and Engineering
6. TELECOM ELECTRONICS MANUFACTURING SERVICES MARKET, BY GEOGRAPHY
6.2. North America
6.3. South America
6.4.3. United Kingdom
6.5. Middle East and Africa
6.5.1. Saudi Arabia
6.6. Asia Pacific
6.6.3. South Korea
7. COMPETITIVE ENVIRONMENT AND ANALYSIS
7.1. Major Players and Strategy Analysis
7.2. Emerging Players and Market Lucrativeness
7.3. Mergers, Acquisitions, Agreements, and Collaborations
7.4. Vendor Competitiveness Matrix
8. COMPANY PROFILES
8.2. Flex Ltd. Flextronics International, LTD
8.3. Jabil Inc
8.4. Celestica Inc
8.5. Compal Inc
8.6. Sanmina Corporation
Flex Ltd. Flextronics International, LTD
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