Juggling Clients’ Unique Requirements and Short Turnaround Times Fuel Surge in Electronics Manufacturers’ Digital Transformation Spend to US$70 Billion in 2034

The electronics industry is characterized by increasingly sophisticated devices for consumer and industrial users. Contract manufacturers must be ready to ramp up production in time for varied product launch dates and gift-giving occasions throughout the year. Global technology intelligence firm ABI Research forecasts that electronics manufacturers will spend more than US$70 billion in 2034 on digital technologies to support their operations, up from US$34.5 billion in 2022.

“A big challenge for electronics manufacturers is having to assimilate the needs of each client. Often, that means inadequate lead times and shorter production runs of 12 weeks or less,” explains Michael Larner, Industrial and Manufacturing Research Director at ABI Research.

To meet these requirements, contract manufacturers (such as Foxconn, Jabil, and Wistron) deploy a range of strategies. These strategies may involve catering to specific customer groups, such as assembling mobile devices and laptops, particularly for high-profile brands like  Apple and Samsung. Alternatively, they may provide manufacturing services to a diverse range of end customers, serving the needs of consumer electronics brands, medical device manufacturers, or automotive suppliers.

Technology suppliers such as Hexagon, HPE, Rockwell Automation, and Siemens can assist manufacturers in increasing automation levels at their facilities and improving quality.  According to Larner, “Digital threads communicating key product, engineering, manufacturing, and quality-related information will be critical to manufacturers’ efforts to meet customer orders.”

In addition, security is a significant priority for electronics manufacturers. “Contract manufacturers will prioritize investments in cybersecurity to ensure their clients’ Intellectual Property (IP) and associated production information are protected at all times,” Larner concludes.

These findings are from ABI Research’s Digitalization and Electronics Manufacturing report. This report is part of the company’s Industrial and Manufacturing Markets research service, which includes research, data, and ABI Insights.