Electronics contract manufacturing market to grow at a CAGR of 9%

The global electronics contract manufacturing (ECM) market was valued at $410 billion in 2011, and is projected to grow at a five-year compound annual growth rate (CAGR) of 9% from 2013-2018, to increase from its market value of $435 billion in 2013 to $670 billion in 2018.

Segment wise, computers and telecommunications are projected to account for nearly $243 billion in 2012 and $250 billion in 2013. The market is expected to reach $389 billion by 2018, a CAGR of 9.3%.

The consumer and industrial segment is projected to total $128 billion in 2012 and $132 billion in 2013. This segment is expected to reach nearly $203 billion in 2018, a CAGR of 8.9%.

Other applications should account for nearly $51 billion in 2012 and $53.4 billion in 2013. This segment is expected to reach nearly $78 billion 2018, a CAGR of 7.9%.

Chinese manufacturing operations accounted for 75% of the growth last year, and they are expected to continue this domination. For example, Hon Hai Precision Industries, the largest outsourced manufacturing provider, reported nearly 60% revenue growth year to year in the first nine months of 2010.

Chinese contract manufacturers are expecting to benefit from the country's booming domestic economy, which is expected to grow by almost 10% this year, much faster than either Europe or the US.

Contract manufacturers assemble a variety of electronic goods for both enterprise and consumer brands, from Apple Inc.'s iPhone, iPod and iPad, to Cisco System's routers, to Hewlett-Packard Co.'s PCs.