Market Size of Automotive Engineering Services Outsourcing Industry
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 88.02 Billion |
| Market Size (2029) | USD 343.99 Billion |
| CAGR (2024 - 2029) | 24.50 % |
| Fastest Growing Market | Europe |
| Largest Market | Asia-Pacific |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Automotive Engineering Services Outsourcing Market Analysis
The Automotive Engineering Services Outsourcing Market size is estimated at USD 88.02 billion in 2024, and is expected to reach USD 343.99 billion by 2029, growing at a CAGR of 24.5% during the forecast period (2024-2029).
Over the long term, engineering firms are rapidly shifting to outsourcing to save costs, boost efficiency, or increase competence. Companies outsource engineering services for various reasons, including the need for fast delivery, flexibility, a lack of in-house specialists, and a constrained budget. Additionally, increasing demand for electric vehicles, as well as increasing adoption of electric vehicles, autonomous vehicle innovative technologies such as ADAS for vehicle and passenger safety, and lightweight vehicles, are key factors that may positively impact market growth in the coming years.
Considering the growth in electric vehicle sales, several companies from the supply chain are entering into partnerships to enhance the design of vehicle components. Governments have launched various plans and efforts worldwide to encourage buyers to lean toward electric vehicles over conventional automobiles.
- One such plan that encourages the purchase of electric vehicles is the California ZEV program, which intends to have 1.5 million electric vehicles on the road by 2025.
- In November 2023, Capgemini offered sustainable, safe, secure, and connected solutions with key expertise such as software development and product engineering in the Autonomous, Connected, Electric, and Shared vehicles domains. It received the highest “Vision and Capability” rating and was designated the top Leader by the Everest Group ACES Automotive Engineering Services PEAK Matrix Assessment 2023.
Europe is expected to grow significantly in the target market, owing to the presence of OEMs and changing consumer preference toward electric vehicles. The presence of countries such as Germany and the United Kingdom also positively impacts the market’s growth due to the policies and regulations implemented by their governments related to emissions and encouraging the usage of green technology. North America is also expected to witness considerable market growth during the forecast period.
Automotive Engineering Services Outsourcing Industry Segmentation
Engineering services outsourcing refers to using the technology and services connected to the company's core engineering process, such as auto design, computer-aided manufacturing, and design, to produce new-age engineering products at a low cost and with a competitive advantage.
The automotive engineering services outsourcing market has been segmented by service type (designing, prototyping, system integration, and testing), location type (onshore and offshore), vehicle type (passenger vehicle and commercial vehicle), propulsion type (IC engine and electric engine), and geography (North America, Europe, Asia-Pacific, South America, and Rest of the World).
The report offers market size and forecasts for the automotive engineering services outsourcing market in value (USD) for all the above segments.
| By Service Type | |
| Designing | |
| Prototyping | |
| System Integration | |
| Testing |
| By Location Type | |
| Onshore | |
| Offshore |
| Vehicle Type | |
| Passenger Vehicles | |
| Commercial Vehicles |
| Propulsion Type | |
| IC Engine | |
| Electric Engine |
| Geography | ||||||||
| ||||||||
| ||||||||
| ||||||||
|
Automotive Engineering Services Outsourcing Market Size Summary
The automotive engineering services outsourcing market is experiencing significant growth, driven by the increasing demand for electric and autonomous vehicles, as well as the need for cost-effective and efficient engineering solutions. Companies are increasingly outsourcing engineering services to leverage fast delivery, flexibility, and specialized expertise, which are crucial in the rapidly evolving automotive sector. The market is further bolstered by partnerships across the supply chain to enhance vehicle component design, supported by government initiatives promoting electric vehicles over traditional ones. Regions like Europe and North America are witnessing substantial growth due to favorable policies and a shift towards green technology, while Asia-Pacific is becoming a hub for outsourcing due to the availability of low-cost labor and significant OEM presence.
The market is characterized by a consolidated landscape with major players employing strategies such as acquisitions, collaborations, and new product launches to maintain their competitive edge. Companies like HCLTech and Altair Engineering Inc. are expanding their capabilities through strategic acquisitions, while others are focusing on developing advanced automotive technologies. The presence of established firms and the strategic movements within the market indicate a robust growth trajectory, with the automotive engineering services outsourcing market poised for substantial expansion in the coming years.
Automotive Engineering Services Outsourcing Market Size - Table of Contents
-
1. MARKET DYNAMICS
-
1.1 Market Drivers
-
1.1.1 Exponential Increase in Automotive Sector
-
-
1.2 Market Restraints
-
1.2.1 Digitization of R&D Operations in Automotive Sector
-
-
1.3 Industry Attractiveness - Porter's Five Forces Analysis
-
1.3.1 Threat of New Entrants
-
1.3.2 Bargaining Power of Buyers/Consumers
-
1.3.3 Bargaining Power of Suppliers
-
1.3.4 Threat of Substitute Products
-
1.3.5 Intensity of Competitive Rivalry
-
-
-
2. MARKET SEGMENTATION
-
2.1 By Service Type
-
2.1.1 Designing
-
2.1.2 Prototyping
-
2.1.3 System Integration
-
2.1.4 Testing
-
-
2.2 By Location Type
-
2.2.1 Onshore
-
2.2.2 Offshore
-
-
2.3 Vehicle Type
-
2.3.1 Passenger Vehicles
-
2.3.2 Commercial Vehicles
-
-
2.4 Propulsion Type
-
2.4.1 IC Engine
-
2.4.2 Electric Engine
-
-
2.5 Geography
-
2.5.1 North America
-
2.5.1.1 United States
-
2.5.1.2 Canada
-
2.5.1.3 Rest of North America
-
-
2.5.2 Europe
-
2.5.2.1 Germany
-
2.5.2.2 United Kingdom
-
2.5.2.3 France
-
2.5.2.4 Italy
-
2.5.2.5 Spain
-
2.5.2.6 Rest of Europe
-
-
2.5.3 Asia-Pacific
-
2.5.3.1 China
-
2.5.3.2 Japan
-
2.5.3.3 India
-
2.5.3.4 South Korea
-
2.5.3.5 Rest of Asia-Pacific
-
-
2.5.4 Rest of the World
-
2.5.4.1 South America
-
2.5.4.2 Middle East and Africa
-
-
-
Automotive Engineering Services Outsourcing Market Size FAQs
How big is the Automotive Engineering Services Outsourcing Market?
The Automotive Engineering Services Outsourcing Market size is expected to reach USD 88.02 billion in 2024 and grow at a CAGR of 24.5% to reach USD 343.99 billion by 2029.
What is the current Automotive Engineering Services Outsourcing Market size?
In 2024, the Automotive Engineering Services Outsourcing Market size is expected to reach USD 88.02 billion.
