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The global electronics manufacturing services market traditionally comprised of companies that manufacture electronic products, predominantly assembling components on Printed Circuit Boards (PCBs) and box builds for OEMs. The market was established more than five decades ago to execute manufacturing designs from government, defense, and research institutions. As the years progressed, the market grew to support the overflowing demands that exceeded volume capacity in OEMs. Today OEMs and Original Design Manufacturers (ODMs) are seeing more value from EMS companies, leading to involvement beyond just manufacturing services to product design and developments, testing, aftersales services, such as repair, remanufacturing, marketing, and product lifecycle management. Thus, the EMS market has grown into a multi-billion dollar business over the years.

Conventionally, 3C products have been the majority revenue contributor to the EMS market. However, with the start of the digital age driven by the ever-growing dependence on data, automation, and artificial intelligence, the need to embed electronics into products across all verticals has increased drastically. Some emerging verticals that introduce innovative products by adopting IoT include medical and smart-home devices. The automotive vertical will be one of the growth opportunities in the next decade. The development of self-driving cars and Electric Vehicles (EVs) necessitates advanced electronics-based products such as Advanced Driver Assistance System (ADAS) and infotainment that require the expertise of EMS companies.

While growth opportunities remain strong, there are several significant challenges that EMS companies face. One among them is the stiff competition leading to pricing issues, another being shortening product life cycles, leading to planning and profitability challenges due to low-volume manufacturing. EMS companies are trying to overcome these challenges in a myriad ways combining the traditional and emerging tools and methodologies. However, it would be worth mentioning that the adoption of digital technologies, combining software, connectivity, automation, AI and ML to optimize every aspect of operations to improve time-to-market, time-to-volume, planning and scheduling, and profitability to ultimately improve the customer experience and create a win-win situation.