Report

The European Testing, Inspection, and Certification Market is expected to register a CAGR of approximately 4.7% during the forecast period. Testing, inspection, and certification (TIC) play a significant role, primarily in ensuring that the infrastructure, services, and products meet the standards and regulations pertaining to safety and quality.

Key Highlights
With the trend of inspection and testing across industries at regular intervals, such as oil and gas, becoming a mandate, the TIC services are expected to grow in demand, irrespective of the industrial seasonality. In order to adapt to the diverse quality and safety standards of the import destinations, there is an increasing need for effective testing, inspection, and certification market in the region.
Furthermore, the increase in the volume of imports and exports in the region, especially for products in the food and beverages, consumer electronics, and automotive (electric vehicles) markets, is expected to provide more scope for TIC services in the region. For instance, as per Eurostat, EU imports of goods increased by 23% in 2021 compared with the previous year, while exports of goods increased by 13%.
Safety breaches in recent times, such as Volkswagen, BMW, and Daimler emissions scandal, demonstrate the significance of independent inspection and certification services. They have not only forced tougher regulations and standards but also increased the dependency on the third party for assessment, thus providing scope for independent TIC companies.
The growing adoption of automation technologies across industries makes allied manufacturers transition from legacy systems to smart components and smart machines. Such trends, however, tend to negatively impact the supply chain as more and more stakeholders get involved. Also, as a result of digitization and the development of online sales channels, the TIC industry currently faces considerably complex issues. Increasing numbers of customers require the simultaneous testing of product safety for various markets in the region.
With the COVID-19 pandemic, inspection and testing activities have increased rapidly, owing to the stringent demands for compliance with safety standards and regulations.? The pandemic has also encouraged a shift from traditional on-site testing to remote testing, inspection, and certification.


Europe TIC Market Trends

Consumer Goods & Retail Segment is Expected to Hold Major Market Share


Due to the growing competition in Europe from new markets and increased demand for quality from consumers, quality assurance and compliance solutions are vital for the consumers. Most of the consumer goods and retail services make use of testing and certification. Consumer products and retail is expected to become the fastest-growing segment, considering the expansion of online retail platforms in the region.
TIC services offered by the vendors of the market cover the entire consumer products' value chain from the plan, buy and make, to ship, stock, and sell, in order to enable informed quality and sourcing decisions. The testing services help to verify that the products are safe and conform to different specifications. The advisory and inspection services are useful as they allow customers to meet regulatory requirements.
Also, the pandemic has fueled the demand for connected consumer electronics and IoT devices. Hence, various European vendors are increasingly offering services pertaining to IoT devices and expanding their presence in this space. The growth in wireless devices also needs the certification to address various technologies, including Bluetooth SIG, NFC Forum, LoRa Alliance, Sigfox, and/or GCF and PTCRB for cellular.
Moreover, rising consumer goods production in the region is also creating significant demand for TIC services. For instance, as per Eurostat, in September 2022, compared with September 2021, the production of non-durable consumer goods rose by 5.7%, and that of durable consumer goods increased by 3.6% in the EU.
Consumer and home electronics are regulated under a wide range of policy instruments in the EU, including legislation on general product safety, sector-specific regulation, along with provisions of consumer protection. Consequently, manufacturers and sellers have to comply with many regulations, creating significant demand for TIC services.


Germany is Expected to Witness Significant Growth


The rising automotive production and trends, like electric vehicles and autonomous cars, are expected to increase the demand and adoption of TIC services in Germany. For instance, as per IEA, Germany remained the largest market in Europe in terms of the number of EVs in 2021, with electric cars accounting for 25% of new cars sold overall.
Also, in March 2021, the independent testing institute ISP brought into operation its new EV battery testing center in Salzbergen in northwest Germany, which is expected to deliver all testing services for batteries of EVs.
Moreover, the country is a major consumer of oil, coal, and natural gas. The country's demand for oil is growing with its economy. With the United Kingdom's exit from the European Union countries, Germany has more supremacy over the EU market than before. The size and location of the country give it considerable influence over the European Union's energy sector.?
Considering the growing trends, the government has targeted 55% emissions cut in the oil & gas and automotive sector by 2030 and is planning to introduce carbon pricing for building and transport sector emissions from 2021. Furthermore, Germany's power sector is one of the primary sources of demand for testing and inspection services after the oil and gas sector.
In Germany, the federal states are responsible for official food control and inspection tests. Businesses involved in the production, processing and selling of foodstuffs are required to document the quality of raw materials used by carrying out in-house checks. The growing need for food safety and the increasing international trade are expected to offer potential opportunities during the forecast period.


Europe TIC Market Competitor Analysis

The European testing, inspection, and certification market is moderately competitive and consists of several players. The market appears to be moderately concentrated. Startups and incumbent TIC companies with a digital focus are posing tough competition with traditional TIC companies. Existing TIC companies are expected to continue making M&A activities a part of their core strategy over the forecast period, considering the anticipated market growth and increasing globalization.


November 2022 - SGS acquired Bucharest-based Industry Lab, further enhancing its range of testing services for the Romanian food market. Industry Lab offers a wide range of microbiological analysis services, from the enumeration of indicator organisms to the detection of foodborne pathogens.
June 2022 - JTUV Rheinland opened a state-of-the-art independent test center for electrical vehicle drive batteries at the Dutch-German Avantis business park. With an area of around 2,200 square meters, the laboratory is also one of the largest of its kind.


Additional Benefits:

The market estimate (ME) sheet in Excel format
3 months of analyst support