Electronics manufacturing services

Last updated

Electronics manufacturing services (EMS) is a term used for companies that design, manufacture, test, distribute, and provide return/repair services for electronic components and assemblies for original equipment manufacturers (OEMs). The concept is also referred to as electronics contract manufacturing (ECM). [1]

Contents

Many consumer electronics are built in China and countries of Southeast Asia, due to maintenance cost, availability of materials, and speed as opposed to other countries such as the United States. [2] Cities such as Shenzhen, China and Penang, Malaysia have become important production centres for the industry, attracting many consumer electronics companies such as Apple Inc. [3] Some companies such as Flex and Wistron are original design manufacturers and providers of electronics manufacturing services.

History

The EMS industry was initially established in 1961 by SCI Systems of Huntsville Alabama. The industry realized its most significant growth in the 1980s; at the time, most electronics manufacturing for large-scale product runs was handled by the OEMs in-house assembly. These new companies offered flexibility and eased human resources issues for smaller companies doing limited runs. The business model for the EMS industry is to specialize in large economies of scale in manufacturing, raw materials procurement and pooling together resources, industrial design expertise as well as create added value services such as warranty and repairs. This frees up the customer who does not need to manufacture and keep huge inventories of products. Therefore, they can respond to sudden spikes in demand more quickly and efficiently. [4]

The development of surface mount technology (SMT) on printed circuit boards (PCB) allowed for the rapid assembly of electronics. By the mid-1990s the advantages of the EMS concept became compelling and OEMs began outsourcing PCB assembly (PCBA) on a large scale. By the end of the 1990s and early 2000s, many OEMs sold their assembly plants to EMSs, aggressively vying for market share. A wave of consolidation followed as the more cash-flush EMS firms were able to buy up quickly both existing plants as well as smaller EMS companies.

Market segments

Electronic Circuit Board Assembly Electronic Printed Circuit Board.jpg
Electronic Circuit Board Assembly

The global market for Electronics Manufacturing Services (EMS) reached an estimated value of US$504.2 billion in 2023 and is projected to grow at a CAGR of 4.94% during the forecast period 2024-2030, reaching a revised size of US$707.5 billion by 2030. [5] The EMS industry is commonly divided into Tiers by their revenue: [6]

There is no hard rule on the actual revenue designation at this time. Other categories have been suggested by StepBeyond/EMSinsider and CIRCUITS ASSEMBLY: Micro Tier (<$50M); Tier 4 <10m and "Tier Mega" referring to the Big 2, Foxconn and Flex.[ citation needed ]

Another distinction is drawn between EMS that specializes in High Mix Low Volume (HMLV) and High Volume Low Mix (HVLM). Mix refers generally to the complexity or different models of the PCB assembly. Volume refers to the number of units built, with products like consumer electronics on the high end and prototype, medical electronics or machinery on the low end. Typically, lower Tier EMS provide HMLV and higher Tier provide HVLM.[ citation needed ]

During technology's late-1990s heyday, EMS players routinely acquired assets in high-cost locations. EMS players largely focused on printed circuit board fabrication, leaving system assembly to the OEMs. EMS companies largely disdained industries outside the world of information processing (computers) and communications. In recent years, EMS players have shifted production to low-cost geographies; embraced non-traditional industries including consumer electronics, industrial, medical and instrumentation; and added substantial vertical capabilities, stretching from design and ODM through system assembly, test, delivery and logistics, warranty and repair, network services, software and silicon design, and customer service.[ citation needed ]

EMS has also started to provide design services used in conceptual product development advice and mechanical, electrical and software design assistance. Testing services perform in-circuit, functional, environmental, agency compliance, and analytical laboratory testing. Electronics manufacturing services are located throughout the world and provide numerous benefits. [7] They vary in terms of production capabilities and comply with various quality standards and regulatory requirements.

E2MS

E2MS (Electronic Engineering Manufacturing Service) refers to the strategy of integrating product development, prototyping and industrialization services into a traditional EMS business, with the aim to harness potential synergies. A typical E2MS offering will start in the design phase, then continue to support the client in development, prototyping, tooling and production all the way to the testing phase, allowing for faster ramp-up as the product is prepared for mass-production up-front.

The term E2MS was first coined by Escatec and has since been adopted by numerous Tier 2 and Tier 3 producers. [8] Larger companies (Tier 1) have gone even further and offered full concept to mass-production and often taking a stake in the intellectual property, becoming more similar to ODM companies.

Related Research Articles

<span class="mw-page-title-main">Electronics</span> Branch of physics and electrical engineering

Electronics is a scientific and engineering discipline that studies and applies the principles of physics to design, create, and operate devices that manipulate electrons and other electrically charged particles. Electronics is a subfield of physics and electrical engineering which uses active devices such as transistors, diodes, and integrated circuits to control and amplify the flow of electric current and to convert it from one form to another, such as from alternating current (AC) to direct current (DC) or from analog signals to digital signals.

<span class="mw-page-title-main">Printed circuit board</span> Board to support and connect electronic components

A printed circuit board (PCB), also called printed wiring board (PWB), is a medium used to connect or "wire" components to one another in a circuit. It takes the form of a laminated sandwich structure of conductive and insulating layers: each of the conductive layers is designed with a pattern of traces, planes and other features etched from one or more sheet layers of copper laminated onto or between sheet layers of a non-conductive substrate. Electrical components may be fixed to conductive pads on the outer layers, generally by means of soldering, which both electrically connects and mechanically fastens the components to the board. Another manufacturing process adds vias, drilled holes that allow electrical interconnections between conductive layers.

<span class="mw-page-title-main">Quanta Computer</span> Taiwan-based manufacturer of notebook computers and other electronic hardware

Quanta Computer Incorporated is a Taiwan-based manufacturer of notebook computers and other electronic hardware. Its customers include Apple Inc., Dell, Hewlett-Packard Inc., Acer Inc., Alienware, Amazon.com, Cisco, Fujitsu, Gericom, Lenovo, LG, Maxdata, Microsoft, MPC, BlackBerry Ltd, Sharp Corporation, Siemens AG, Sony, Sun Microsystems, Toshiba, Valve, Verizon Wireless, and Vizio.

<span class="mw-page-title-main">Flex Ltd.</span> Singaporean contract manufacturing company

Flex Ltd. is an American headquartered multinational diversified manufacturing company. It is the third largest global electronics manufacturing services (EMS), original design manufacturer (ODM) company by revenue, behind only Pegatron for what concerns original equipment manufacturers. Flex's U.S. corporate headquarters are located in Austin, Texas. The company has manufacturing operations in over 30 countries, totaling about 172,000 employees.

<span class="mw-page-title-main">Solectron</span> Electronics manufacturing company

Solectron Corporation was an American electronics manufacturing company for original equipment manufacturers (OEMs). It was the first electronics manufacturing services (EMS) industry in 1977. Solectron's first customer designed and distributed an electronic controller for solar energy equipment. The name "Solectron" was a portmanteau of the words "solar" and "electronics".

<span class="mw-page-title-main">Sanmina Corporation</span> American company

Sanmina Corporation is an American electronics manufacturing services (EMS) provider headquartered in San Jose, California that serves original equipment manufacturers in communications and computer hardware fields. The firm has nearly 80 manufacturing sites, and is one of the world’s largest independent manufacturers of printed circuit boards and backplanes. As of 2022, it is ranked number 482 in the Fortune 500 list.

Skyworth, officially Skyworth Group Co., Ltd., is a Chinese holding company. Its subsidiaries design, manufacture and sell televisions and other audio-visual products. They also invest in properties. Headquartered in Nanshan High-tech Park, Shenzhen, as of 2010, Skyworth has operations in Hong Kong and Inner Mongolia as well as in various locations in Guangdong including Shenzhen, Guangzhou, and Dongguan.

<span class="mw-page-title-main">Flat no-leads package</span> Integrated circuit package with contacts on all 4 sides, on the underside of the package

Flat no-leads packages such as quad-flat no-leads (QFN) and dual-flat no-leads (DFN) physically and electrically connect integrated circuits to printed circuit boards. Flat no-leads, also known as micro leadframe (MLF) and SON, is a surface-mount technology, one of several package technologies that connect ICs to the surfaces of PCBs without through-holes. Flat no-lead is a near chip scale plastic encapsulated package made with a planar copper lead frame substrate. Perimeter lands on the package bottom provide electrical connections to the PCB. Flat no-lead packages usually, but not always, include an exposed thermally conductive pad to improve heat transfer out of the IC. Heat transfer can be further facilitated by metal vias in the thermal pad. The QFN package is similar to the quad-flat package (QFP), and a ball grid array (BGA).

<span class="mw-page-title-main">Integrated Micro-Electronics, Inc.</span>

Integrated Micro-electronics, Inc. provides electronics manufacturing services (EMS) and power semiconductor assembly and test services (SATS) with manufacturing facilities in Asia, Europe, and North America. Its headquarters is located in Biñan, Laguna.

SMTC Corporation, founded in 1985, is a mid-size provider of end-to-end electronics manufacturing services (EMS) including PCBA production, systems integration and comprehensive testing services, enclosure fabrication, as well as product design, sustaining engineering and supply chain management services. SMTC facilities span a broad footprint in the United States, Canada, Mexico, and China, with more than 2,300 employees. SMTC services extend over the entire electronic product life cycle from the development and introduction of new products through to the growth, maturity and end-of-life phases. SMTC offers fully integrated contract manufacturing services with a distinctive approach to global original equipment manufacturers (OEMs) and emerging technology companies primarily within industrial, computing and communication market segments. SMTC was recognized in 2012 by Frost & Sullivan with the Global EMS Award for Product Quality Leadership and 2013 with the North American Growth Leadership Award in the EMS industry, as one of the fastest growth companies in 2012.

<span class="mw-page-title-main">First International Computer</span>

First International Computer, Inc. is a Taiwanese original equipment manufacturer and system integrator for automotive electronics and smart building controls. FIC provides design consultancy and supply chain management services for automotive electronic suppliers worldwide.

Altium Limited is an Australian multinational software company that provides electronic design automation software to engineers who design printed circuit boards. Founded as Protel Systems Pty Ltd in Australia in 1985, the company has regional headquarters in the United States, Australia, China, Europe, and Japan. Its products are designed for use in a Microsoft Windows environment and used in industries such as automotive, aerospace, defence and telecommunications. Its flagship product, Altium Designer, is a software for unified electronics design. Since August 2024, Altium is a subsidiary of Renesas Electronics.

<span class="mw-page-title-main">IPC (electronics)</span> Trade association for electronics

IPC is a trade association whose aim is to standardize the assembly and production requirements of electronic equipment and assemblies. IPC is headquartered in Bannockburn, Illinois, United States with additional offices in Washington, D.C. Atlanta, Ga., and Miami, Fla. in the United States, and overseas offices in China, Japan, Thailand, India, Germany, and Belgium.

CR-5000 is Zuken's EDA design suite for electronic systems and printed circuit boards aimed at the enterprise market. It was developed to address complex design needs that involve managing the complete development and manufacturing preparation process on an enterprise-wide scale. CR-5000 is made to facilitate the design of complex and high-speed boards, with features aimed at addressing challenges such as signal integrity and electromagnetic compatibility.

Package on a package (PoP) is an integrated circuit packaging method to vertically combine discrete logic and memory ball grid array (BGA) packages. Two or more packages are installed atop each other, i.e. stacked, with a standard interface to route signals between them. This allows higher component density in devices, such as mobile phones, personal digital assistants (PDA), and digital cameras, at the cost of slightly higher height requirements. Stacks with more than 2 packages are uncommon, due to heat dissipation considerations.

<span class="mw-page-title-main">Videoton (company)</span>

Videoton, officially VIDEOTON HOLDING Ltd. is a privately-owned company group based out of Székesfehérvár, Hungary and specializing in contract manufacturing. The company was founded in 1938 and it became well known among the Warsaw Pact/Comecon countries for supplying stadium-sized electronic scoreboards. In 1991 the company was privatized and since then Videoton has provided contract manufacturing services for its partners.

Orbotech Ltd. a subsidiary of KLA Corporation and a technology company used in the manufacturing of consumer and industrial products throughout the electronics and adjacent industries. The company providing electronics reading, writing, and connecting solutions used by manufacturers of printed circuit boards, flat panel displays, advanced packaging, micro-electro-mechanical systems and other electronic components. The company is headquartered in Yavne, Israel and operates in North America, Europe, Japan and Asia-Pacific.

Benchmark Electronics Inc is an EMS, ODM, and OEM company based in Tempe, Arizona in the Phoenix metropolitan area. It provides contract manufacturing services.

Falco Electronics is a multinational Mexican electronics corporation founded in 1991, in Mérida, Yucatán, México. The company sells products under its own name and also acts as an ODM, OEM and ECM/EMS.

In 2022, Enics merged with Denmark’s largest electronics manufacturer GPV, becoming one of the leading EMS manufacturers with European headquarters.

References

  1. ↑ Lüthje, Boy (2002). "Electronics Contract Manufacturing: Global Production and the International Division of Labor in the Age of the Internet". Industry and Innovation. 9 (3): 227–247. doi:10.1080/1366271022000034471. S2CID   153359373.
  2. ↑ Baker, Phil (11 August 2014). "Why can't the US build consumer electronic products?". San Diego Source. Archived from the original on 21 April 2019. Retrieved 9 September 2014.
  3. ↑ Gamble, Craig (22 August 2014). "Shenzhen in China becomes a power source for the electronics industry". Brisbane Times. Archived from the original on 25 August 2014. Retrieved 9 September 2014.
  4. ↑ "The new rules for global supply chain management ( Manufacturing Business Technology )". www.mbtmag.com. Archived from the original on 23 April 2007. Retrieved 17 January 2022.
  5. ↑ "Electronics Manufacturing Services Market Size & Forecast to 2030". PragmaMarketResearch. Retrieved 2024-05-14.
  6. ↑ "What is Electronics Manufacturing Services (EMS): [Guide to Application, Contracting and Opportunity] | TT Electronics". www.ttelectronics.com. Retrieved 2024-05-16.
  7. ↑ Paul Anastasio. "Benefits & Applications of PCB electronic manufacturing services".
  8. ↑ Betz, Fredrick (2010). Creating and Managing a Technology Economy. World Scientific. ISBN   978-981-4313-38-4.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.