March 2, 2024

Automotive Engineering Services Market to Grow Nearly 8.7% through 2030

According to Precedence Research, the global automotive engineering services market size will attain US$ 360.22 billion by 2030, growing at a CAGR of 8.7% from 2021 to 2030.

Automotive Engineering Services Market Size 2021 to 2030

The automotive engineering services market is expected to be driven by the growing technological skills for engineering service providers to offer research and development and product innovation in their solutions for connected automobiles, vehicle positioning, and guidance systems. In addition, the automotive engineering services market’s overall growth is likely to benefit from original equipment manufacturers rapid shift in preference for digital solutions over mechanical and core assistance.

However, due to the depth and complexity of the powertrain, transmission, and engine designs, manufacturers prefer to design these components in-house rather than outsourcing them to engineering services providers.

Furthermore, growing problems about the exposure of intellectual property and design are prompting original equipment manufacturers to establish their own manufacturing facilities. As a result, the automotive engineering services market’s growth is expected to be hampered by manufacturers’ increasing focus on producing in-house design.

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Automotive Engineering Services Market Scope
Report CoverageDetails
Market Size by 2030USD 360.22 Billion
Growth Rate from 2022 to 2030CAGR of 8.7%
Base Year2021
Largest MarketEurope
Fastest Growing MarketAsia Pacific
Forecast Period2022 to 2030
Automotive Engineering Services Market  – Report Highlights
  • Based on the service, the prototyping segment is the fastest growing segment in the global automotive engineering services market. The shorter manufacturing timeframes and reduced production costs are achieved by prototype approaches, as are easier product innovation and supply chain transformation as well as cleaner, safer, and lighter part designs.
  • Europe is the largest segment for automotive engineering services market in terms of region. Europe is home to one of the world’s greatest automotive manufacturing centers, and automobile manufacturers are an important part of the European economy. The government is providing subsidies and pushing the availability of energy efficient automobiles, which has resulted in an increase in demand for electric vehicles.
  • Asia-Pacific region is the fastest growing region in the automotive engineering services market. Many governments in the region intend to replace their present public fleets with electric vehicles. The rapid expansion of the logistics sector is also boosting demand for commercial electric automobiles, which in turn is driving up demand for automotive engineering services.
Automotive Engineering Services Market Dynamics

DriversStandardization of safety features

Several governments around the world have mandated safety features in new vehicles to reduce over speeding and fatal accidents. The advanced safety features include advanced emergency braking, emergency lane-keeping systems, and enhanced crash tests. All of these requirements are critical to overall road safety.

To improve passenger safety, automakers must comply with the new regulations. In the coming years, all of these mandates will have a significant impact on vehicle safety. The original equipment manufacturers’ initiatives to implement these features early will result in a high demand for engineering service providers to provide these solutions.


Security threats

The automotive engineering services play a significant role in vehicle advanced driver-assistance system technologies. The majority of advanced driver-assistance systems safety features include sensors like radar, ultrasonic sensors, cameras, infrared, and various actuators. The precise of fail-safe techniques could put occupant safety at danger. Thus, the security is very important for the occupant. Hence, this factor could hamper the growth of the global automotive engineering services market during the forecast period.

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Rising sales of electric vehicles

The global e-vehicle industry is rapidly expanding. Electric vehicles, like any transformative disruptive technology, activate lots of new influential economic development, challenges, and opportunities. The global electric vehicle sales are being driven by increasing vehicle range increased charging infrastructure availability and proactive participation by automotive original equipment manufacturers.

Furthermore, the growing sensitivity of various governments toward a cleaner environment has increased demand for zero-emission vehicles, which is supporting the growth of the electric vehicle market. The developed countries are actively promoting the use of electric vehicles to reduce emissions, which has resulted in increased sales of electric vehicles. As a result, the rising sales of electric vehicles are creating lucrative opportunities for the growth of the automotive engineering services market.


Intellectual property rights

The outsourcing is now widely used by original equipment manufacturers and system integrators in the automotive industry. A typical engineering service begins with research and progresses through design and testing phases before reaching the final stage of production. In some cases, the original equipment manufacturer owns the intellectual property of new technology or processes developed throughout the process.

However, service providers may be working with multiple original equipment manufacturers for similar requirements or specifications, with the limitation of using existing technology patented by various original equipment manufacturers. As a result, service providers must exercise extreme caution when it comes to intellectual property infringement laws. Intellectual property laws prohibit service providers from repeatedly using the same technology, which may limit the use of their engineering service technology.

Some of the prominent players in the global automotive engineering services market include:

  • Tech Mahindra Limited
  • L&T Technology Services
  • IAV Automotive Engineering
  • HCL Technologies
  • Harman International Industries Inc.
  • AltenCresttek Company
  • Akka Technologies
  • Fev Europe GmbH
  • Capgemini SE
  • Bertrandt AG
Automotive Engineering Services Market Segments

By Location

  • On-shore
  • Off-shore

By Service

  • Designing
  • Prototyping
  • System Integration
  • Testing
  • Others

By Application

  • Autonomous Driving
  • Body & Chassis
  • Powertrain & After-treatment
  • Infotainment & Connectivity
  • Others

By Vehicle Type

  • Passenger Cars
  • Commercial Vehicles

By Nature

  • Body-Leasing
  • Turn-Key

By Geography

  • North America
    • U.S.
    • Canada
  • Europe
    • U.K.
    • Germany
    • France
  • Asia-Pacific
    • China
    • India
    • Japan
    • South Korea
    • Malaysia
    • Philippines
  • Latin America
    • Brazil
    • Rest of Latin America
  • Middle East & Africa (MEA)
    • GCC
    • North Africa
    • South Africa
    • Rest of the Middle East & Africa

Thanks for reading you can also get individual chapter-wise sections or region-wise report versions such as North America, Europe, or the Asia Pacific.

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