PUBLISHER: Verified Market Research | PRODUCT CODE: 1736944
PUBLISHER: Verified Market Research | PRODUCT CODE: 1736944
Increasing demand for consumer electronics, driven by the rapid advancement of technologies like IoT, AI, and 5G, has significantly impacted the market size of the Electronic Contract Manufacturing and Design Services sector. According to the analyst from Verified Market Research, the Electronic Contract Manufacturing And Design Services Market is estimated to reach a valuation of USD 765.76 Billion over the forecast subjugating around USD 367.8 Billion valued in 2024.
The rapid expansion of the electronic contract manufacturing and design services market is primarily driven by the rising demand for innovative and cost-efficient electronics production. It enables the market to grow at a CAGR of 9.60% from 2026 to 2032.
Electronic Contract Manufacturing And Design Services Market: Definition/ Overview
The Electronic Contract Manufacturing and Design Services (ECM & DS) industry is defined by the outsourcing of manufacturing processes and design services to specialized third-party providers. It is characterized by a range of services, including producing electronic components, product design, engineering support, and supply chain management. These services are employed by various sectors such as consumer electronics, telecommunications, automotive, healthcare, and industrial equipment, where efficiency and cost savings are prioritized. The need for scalability, flexibility, and access to advanced technological expertise has driven the reliance on ECM & DS providers.
Rising demand for high-quality electronic products and the rapid evolution of technology have contributed to the growth of this market. The increasing use of IoT, AI, and 5G technologies has fueled the need for efficient production methods and innovative designs, further expanding the application of ECM & DS across diverse industries.
The growing demand for advanced consumer electronics is being recognized as a key driver of the electronic contract manufacturing and design services market. Increased adoption of IoT, AI, and 5G technologies is being witnessed across industries, which has led to the rising outsourcing of manufacturing services. According to Ericsson's Mobility Report, 5G subscriptions are expected to reach 4.4 billion globally by the end of 2027, accounting for about 48% of all mobile subscriptions.
Companies are focusing on minimizing production costs and accelerating time-to-market by utilizing the expertise of contract manufacturers. The shift toward smaller, more complex electronic components is being addressed by specialized third-party providers, enabling higher quality and more efficient production. According to the United Nations Conference on Trade and Development (UNCTAD), global electronics production reached USD 2.9 Trillion in 2020, despite the pandemic-induced slowdown. This trend is expected to drive significant growth in the market, especially as technological advancements continue.
A major restraint affecting the expansion of the electronic contract manufacturing and design services market is being attributed to concerns over intellectual property (IP) theft. Companies that rely heavily on outsourcing manufacturing operations are facing risks related to the potential loss of proprietary technologies and designs.
Stringent regulations and rising cybersecurity concerns are increasing the need for greater IP protection measures, limiting the full utilization of contract manufacturing in sensitive industries. This issue is being further compounded by cross-border operations, where legal complexities may vary, making IP enforcement more challenging. The need for robust IP management strategies is likely to restrain market growth.
According to VMR Analyst, the dominance of the consumer electronics segment in the electronic contract manufacturing and design services market is attributed to the high demand for electronic devices such as smartphones, laptops, and wearable technology. Outsourcing production to third-party manufacturers is being driven by the need for cost-effective manufacturing processes and shorter product lifecycles.
Increasing complexity in electronic design and assembly is being managed by contract manufacturers, who are providing specialized services to meet the rapid pace of technological advancements. The segment's market share is being supported by a global rise in consumer spending on electronics, making it a key driver of growth within the overall market.
According to VMR Analyst, the rapid growth of the healthcare segment in the electronic contract manufacturing and design services market is being fueled by the increasing demand for medical devices and advanced healthcare equipment. Rising outsourcing by medical device manufacturers is being observed as a strategy to manage cost pressures and regulatory complexities.
The growing need for precision engineering and high-quality components in devices such as diagnostic equipment and wearable health monitors is being addressed by contract manufacturers, who offer specialized design and assembly services. The trend toward connected healthcare devices and telemedicine solutions is further driving the expansion of this sub-segment, as innovation in healthcare technology continues to grow.
According to VMR Analyst, North America's dominance in the electronic contract manufacturing and design services market is being driven by the presence of established technology giants and high demand for advanced electronics. The region's strong innovation ecosystem is being supported by leading semiconductor and electronic device manufacturers, who rely on outsourcing to manage production costs and accelerate time-to-market.
The North American region, particularly the United States, is at the forefront of adopting advanced technologies in manufacturing, driving demand for sophisticated electronic contract manufacturing services. According to the U.S. Census Bureau's Annual Survey of Manufacturers, the value of shipments for computer and electronic products manufacturing in the United States reached USD 292.5 Billion in 2020, highlighting the significant scale of the electronics industry in the region.
Increasing investment in emerging technologies such as AI, IoT, and 5G is also contributing to the market's growth. Additionally, the aerospace and defense industries are increasingly utilizing contract manufacturing to produce highly specialized components, reinforcing North America's leading position in the market.
The rapid growth of the electronic contract manufacturing and design services market in the Asia Pacific is being driven by the region's strong manufacturing base and competitive labor costs. According to the United Nations Industrial Development Organization (UNIDO), East Asia's share in global manufacturing value added increased from 31.9% in 2010 to 43.1% in 2020, with China alone accounting for 28.7% of the global total. A high concentration of original equipment manufacturers (OEMs) is being observed, particularly in China, South Korea, and Taiwan, where large-scale production of consumer electronics and semiconductors is taking place.
Rising demand for electronics in both domestic and global markets is being fueled by increasing disposable incomes and the expansion of the middle class. Additionally, government initiatives aimed at promoting industrial development and technological innovation are further boosting the market's expansion in the region. The Indian government's "Make in India" initiative, launched in 2014, has led to significant growth in the electronics manufacturing sector. According to the India Brand Equity Foundation (IBEF), the production of electronic goods in India increased from INR 1,903.1 billion in FY15 to INR 5,544.6 billion in FY20, growing at a CAGR of 23.8%.
The Electronic Contract Manufacturing And Design Services Market's competitive landscape is characterized by a varied range of companies, including technology developers, plant operators, and service providers, all striving for market share in an increasingly dynamic and growing industry.
Some of the prominent players operating in the electronic contract manufacturing and design services market include:
Benchmark Electronics, Inc.
Celestica, Inc.
Compal Electronics, Inc.
Creating Technologies LP
Fabrinet
Flextronics International Ltd.
Hon Hai Precision Industry Co. Ltd.
Jabil Circuit, Inc.
Plexus Corporation
Venture Corporation Limited.
In March 2020, Samina-SCI Corporation's new manufacturing and supply plant in Thailand opened. The new facility incorporates certain new features and procedures for the efficient production of advanced optical, radio frequency, and high-speed microelectronic products.
In November 2020, Syrma Technology, a prominent provider of electronic design and production services to local OEMs, announced a cash and equity merger with SGS Tekniks. The primary goal of this merger was to develop innovative RFID technology, power electronics, and bespoke magnetics for various automotive, computing, medical, power, and telecommunications firms.
In August 2020, Creation Technologies stated that it would expand its manufacturing facilities and production capacity in Hermosillo, Mexico. The expanded capacity increases the total space from 205,000 square feet to 330,000 square feet, complementing the company's existing capacity in the country.