Electronic Manufacturing Services Market Trends

Growth Drivers

• Increasing Adoption of Greener Electronic Devices - The expansion of the electronics manufacturing services market is being driven by the appearance of green electronic products. These devices are produced using recyclable materials, non-toxic chemicals, and low carbon emissions. It improves process control, lowers energy use, and reduces carbon footprints.
• Expanding Automobile Industry - It is projected that the growing electrification of cars and other vehicles, along with the increased need for electronic components by manufacturers, will drive the EMS market's expansion. Previously, PCBs were primarily used in headlight switches and windshield wipers, but as automation & sensor technology increased in the automotive industry, the demand for PCBs & many other electronic part components increased to enable many high-tech features to improve safety & automation while driving. According to predictions, the electronics in cars are expected to account for 50% of a new car's overall cost in the future.
• Growing Investment in Semiconductor Foundry – Sales of semiconductors are expanding, and there is a global shortage of them, which has prompted increased investment in semiconductor manufacture. This will ultimately help the market grow. It was noted that in Japan, semiconductor sales peaked in April 2020 at around USD 2.8 billion and peaked in December 2020 at around USD 3.3 billion.
• Increasing Automation in Various End-Use Industries – According to projections, automation will increase worldwide productivity by as much as 15 % and this is why the majority of companies and processes are adopting it. This is also leading to an increase in demand for industrial robots. The growth of the market is expected to be supported by all these factors.

Challenges

• Uneven Presence of Semiconductor Foundries Worldwide –The microchip shortage is restraining the growth of many companies in the global market. Moreover, stiff competition among the EMS clusters, lowering profits for small market players, especially in developing & underdeveloped nations, and rapid technological advancements in the area of semiconductor manufacturing are further estimated to hamper the market growth over the forecast period
• High Upstart Investment
•  Rising Concern About the Environmental Impact of Electronics Manufacturing.