Electronic connectors are widely used in the electronics industry to connect wires and cables. The global connector market is heavily influenced by the global economic circumstance, and in 2021, the world GDP has seen an optimistic rebound. IMF (International Monetary Fund) has anticipated a 6.03% growth of the nominal GDP and the projected GDP (PPP), which are estimated to reach USD 93,864 billion and USD 141,962 billion.
Valuates Reports has projected the global connector market to grow with a CAGR of 6.7% from 2020 to 2027, and come to USD 98.12 billion by then. In the geographical view, North America still accounts for the largest portion in 2021, but by 2027, Asia Pacific will replace it. In this article, we will describe the contour of the global connector market from 2 aspects: the dominant connector types and the market driving applications.
PCB Connectors Dominate the Connector Market
Connector products can be categorized into several types, which include PCB (Printed Circuit Board) connectors, I/O connectors, RF (Radio Frequency) coaxial connectors, fiber optic connectors, circular connectors, and so on. PCB connectors connect PCBs to other PCBs or different kinds of boards; I/O connectors connect I/O ports outside of the devices; fiber optic connectors connect fiber cables; RF coaxial connectors especially used to transmit radio frequency signals on TVs or other devices; circular connectors are designed with circular interfaces. In general, circular connectors can transmit data in rather difficult environments.
In the semiconductor industry, PCB connectors are used most widely. It is believed that with the continuous rise of electronic devices globally, PCB connectors will still dominate the connector market in 2021. However, fiber optic and RF coaxial connectors with advanced technologies are gradually increasing since they suit well to be implemented in automotive and other data-related applications in the connector market.
Telecom, Industrial, and Automotive Sectors Fuel the Connector Market
With the rising of IoT, AI, and big data analysis, the demand for data centers has grown significantly for each application, and therefore brings up the need for connectors. Currently, applications for the connector market include but are not limited to computer and peripherals, telecom (telecommunications), transportation, automotive, and industrial sectors. Being a supporting role in the market, the demand for connectors increases along with the rising of these applications. Overall speaking, the driving forces of the global connector market in the coming years would be telecom, industrial, and automotive applications. And all of them are deeply influenced by the COVID-19 pandemic and how it changes the world.
1. Telecom Boosts the Need for Connectors in the Market
The telecom sector is always a hot discussion topic as data communication across long distances has been a part of people’s lives for a long time. According to Grand View Research and Research and Markets, the global telecom services and equipment markets achieved USD 1,657.7 billion and USD 481.75 billion in 2020, respectively. Moreover, from 2020 to 2027, a single-digit CAGR in both markets is predicted.
Smartphones, 5G connectivity deployment, and other communication networks all boost the telecom market and require more usages of connectors. Besides, the pandemic has brought up strong demand for telecom equipment upgrades—both in business working spaces and home entertainment domains. The arrangements of working from home push companies to have better telecom equipment to keep businesses running normally and employees communicating smoothly. On the other hand, with COVID-19 social restrictions, streaming services at home have seen tremendous growth as well. The expansion of the telecom sector has brought a positive impact on the connector market.
2. Industry 4.0 Brings Up the Demand of Connectors in the Market
Industry 4.0 speeds up the development of the industrial sector and fuels the connector market. According to Mordor Intelligence (https://www.mordorintelligence.com/industry-reports/industry-4-0-market), the industry 4.0 market is predicted to rise to USD 267.01 billion by 2026, from USD 86.03 billion in 2020. Industry 4.0 overturns/subverts the original ways of (doing) traditional industry and makes them more cost-effective, productive, and efficient. The deployment/use of connected devices, big data, AI, and other digital technologies makes automatic production realizable. With automatic production, business owners can lower the risk of the pandemic owing to labor force decrease. And of course, during the whole process of automation, a lot more connectors are necessarily needed in the market.
3. Automotive Revolution Raises the Growth of Connectors in the Market
The automotive industry is facing a huge change. Mckinsey has pointed out 4 trends of this industry which include the rise of connected cars, the development of autonomous driving, the diverse of shared mobility, and the replacement of traditional vehicles with electric vehicles. All these trends have indicated the revolution of the automotive sector and raise the demand for vehicles and the electronic components in vehicles. S&P Global Ratings has forecasted the global vehicle sales to 83～85 million units in 2021, with 8～10% growth from 2020 to 2021 () and will continuously grow in the following few years. Furthermore, Roland Berger’s study (from eeNews Automotive) also predicted the cost of electronic components in a car will increase to 35% by 2025 from 16% currently.
All the evidence shows an optimistic future of the automotive industry, and it flourishes the connector market as well since so many kinds of connectors are required in a vehicle (and more connectors are required in an electric vehicle).
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