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Consolidation coming
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19/08/2008
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The global electronics contract manufacturing (ecm) industry is undergoing a period of deceleration and consolidation which is likely to see the market transformed within the next five years.
According to industry specialist iSuppli, revenues for the global ecm industry, are set to grow to $432.3billion by 2012 – a compound annual growth rate (cagr) of 7.2% from 2007. However, says the company, this represents a ‘major slowdown’ compared to the 1990s, when the industry’s cagr reached 49%.
A consequence of slower growth is consolidation amongst the world’s top ecm providers and iSuppli believes that some familiar names will disappear over the next few years.
“As many of the larger ecms attempt to retrench and ‘right size’ their businesses, revenue growth has become stagnant or even negative,” said Adam Pick, iSuppli’s principal EMS/ODM analyst. “Because of this, an examination of possible acquisition targets becomes a top priority for larger companies.”
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Author
Graham Pitcher
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