08 Oct The European EMS market 2021
After publication of the annual reports of the big EMS/ODM companies in Europe, in4ma can finally announce the annual production value 2020 for the European EMS/ODM industry. The research now covers about 85% of all EMS/ODM companies in Europe whereas in specific smaller companies, which normally take themselves more time until they publish their reports in the country company registers had to be modelled. This is done every year in the same way, and the remaining 15% are being updated, when they become available.
During this research for the last 12 month we realized, that the remaining 15% in 2019 had much lower revenues than modelled. 85% of all revenues in Europe had been done by 290 companies only, the remaining 15% was 1682 companies and they lost on average 5.2% in revenues, which was 4.5% more, than was originally modelled. Whereas from 2014 to 2018 the number of companies with revenue growth had been risen from 75% to 80%, 2019 saw a decline to 63%. 37% had a revenue decrease against 2018 and it was mainly smaller EMS which suffered.
This now has led to a reduction of the annual production value 2019 from 44 billion Euro to 43.7 billion Euro. The values for 2020 came out to 41.3 billion Euro, a reduction of 5.4%.
On purpose only the TOP 30 in Europe are shown. TOP 31-50 is a mine filed. There are companies in, which are working in the defence electronics sector and the EMS share can just be modelled, companies which in the majority focus on PCBA repair, OEMs which do EMS as well, and Flex circuitry manufacturers, which today assemble 95% of these flex circuits as well. This means, one can always argue whether they should be considered or not. In4ma has a clear definition what is considered and what is not and this definition has not changed for the last six years.
In the first half of 2021, the EMS industry recovered a lot. In4ma and IPC did a half year survey again in 2021. The main focus was on Germany, Austria and Switzerland, knowing that the values do not vary too much from the rest of Europe. Again reported revenues were analysed by revenue groups and combined with all the analysis results of 2020 to show an overall picture.
This picture shows, that the dramatic effect of Corona only started in the 2. Quarter 2020 and that during the next three quarters improvements were only marginal. The real pick up of business happened during the 2. Quarter of 2021. When looking now at the results for the 2. Quarter 2021 and compare these with the 2. Quarter 2020 it becomes obvious, that only the big (XL) EMS are now doing better that 2019. For the medium EMS companies (L/M) there is still a chance to get to 2019 revenues by the end of the year. For the small companies (S/XS) it will take them until 2022 to get back to 2019 revenues.
For smaller companies, especially those with low equity, it now becomes a hard fight to keep their business going. There are ways to help them to survive, if interested just contact in4ma. Especially marketing becomes more important, especially for the small (S/XS) companies. Some of them live from 3 or 4 customers. The consequences were visible in the 2.Quarter 2020, when the biggest drop in revenues for one company was at 68% and even on average it was 23.9%. Hope will not help in such case, change might.