Automotive Engineering Services Market to Grow with a CAGR of 8.80% through 2030
Rising adoption of advanced driver-assistance systems,
growing demand for connected and autonomous vehicle technologies, and
increasing focus on lightweight and energy-efficient vehicle designs are the
factors driving the market in the forecast period 2026-2030.
According to TechSci Research report, “Automotive
Engineering Services Market – Global Industry Size, Share, Trends, Opportunity,
and Forecast, 2020-2030F”, The Global Automotive Engineering
Services Market was valued at USD 193.89 Billion in 2024 and is expected to
reach USD 321.61 Billion by 2030 with a CAGR of 8.80% during the forecast
period.
The global automotive engineering services market is
being reshaped by the shift to software-defined vehicles, compressed model
cycles, and a relentless push for cost, quality, and feature velocity.
Automakers are outsourcing complex workstreams embedded software, middleware
integration, HMI, and mechatronics to partners that can deliver model-based
systems engineering, continuous integration/continuous deployment pipelines,
and rigorous verification at scale. Growing complexity in homologation and
functional safety is another catalyst: compliance with evolving cybersecurity
and software update regulations is demanding threat modeling, penetration
testing, and secure-by-design architectures across vehicle platforms. At the
same time, rising demand for mass customization and frequent trims is elevating
needs for modular architecture, commonized components, and robust configuration
management to keep bills of material controlled while enabling rapid feature
rollouts.
A second pillar of growth is migration from physical to
virtual development. High-fidelity CAE, hardware- and software-in-the-loop
rigs, and digital twins of powertrain, chassis, and body systems are cutting
prototype counts and time-to-signoff. Sustainability imperatives are widening
the scope of work to include design for recyclability, materials substitution,
and life-cycle assessment embedded in PLM workflows. On the plant side,
industrial engineering mandates line balancing, ergonomic simulation, and traceability
tie product engineering to smart manufacturing. Together, these forces expand
demand for end-to-end partners that can integrate systems, assure compliance,
and industrialize designs with predictable cost and timing.
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Automotive Engineering Services Market Is Segmented by
Vehicle Type, Propulsion Type, Location, Application, and By Region.
In 2024, outsourced automotive engineering services recorded
the fastest growth, driven by the rising complexity of vehicle technologies and
the need for cost-efficient, specialized expertise. Automakers and suppliers
increasingly relied on external engineering partners for advanced simulation,
embedded software development, electronics integration, and compliance testing.
Outsourcing allowed manufacturers to access global talent pools, scale
engineering capacity quickly, and leverage niche capabilities in areas such as
digital twin modeling, modular platform design, and powertrain optimization.
The approach reduced in-house resource constraints and enabled faster
adaptation to evolving safety, emission, and connectivity standards. Growing
adoption of electrification, autonomous technologies, and connected vehicle
systems heightened the demand for service providers capable of delivering
end-to-end solutions, from concept development to validation, across multiple
vehicle programs in parallel.
In 2024, North America emerged as the fastest-growing region
in the automotive engineering services market, fueled by accelerated
investments in electric mobility, autonomous vehicle testing, and
next-generation infotainment systems. Strong demand for compliance-driven
engineering, especially in safety and cybersecurity, spurred the use of
advanced simulation tools and agile development frameworks. The region’s focus
on integrating AI-powered analytics, vehicle-to-everything communication, and
over-the-air update capabilities into engineering projects positioned it as a
leader in deploying innovative, software-driven vehicle solutions.
Major Market Players Operating in Global Automotive
Engineering Services Market Are:
- Harman
International
- FEV
Group
- L&T
Technology Services Ltd
- Robert Bosch GmbH
- Continental AG
- Bertrandt AG
- Capgemini Engineering
- AVL
- EDAG Engineering GmbH
- IAV
GmbH
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“The way I see it, the Global Automotive Engineering
Services Market is at a fascinating crossroads. We’re moving from a world where
cars were primarily mechanical to one where they’re becoming highly
sophisticated, software-driven machines. This shift is opening up huge
opportunities for engineering service providers—whether it’s developing
advanced simulations to cut down on physical prototypes, designing modular
platforms to support multiple powertrains, or embedding AI for smarter, safer
driving experiences. At the same time, the demand for faster development
cycles, compliance with stringent safety and sustainability standards, and the
push toward connected and autonomous mobility means the industry needs partners
who can deliver innovation at speed and scale. It’s no longer just about making
a vehicle run—it’s about creating an intelligent, adaptable platform that can
evolve over its entire lifecycle”, according to Mr. Karan Chechi, Research
Director of TechSci Research, a global research-based management consulting
firm.
“Automotive Engineering Services Market– Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Vehicle Type (Passenger Cars, Commercial Vehicle), By Propulsion Type (ICE, Electric), By Location (In-house, Outsource), By Application (Body Engineering, Chassis Engineering, Powertrain Engineering, Safety Systems, Infotainment Systems, Others), By Region & Competition, 2020-2030F”, assesses the market's
future growth potential and provides data on market size, trends, and
forecasts. It aims to offer comprehensive market insights, helping
decision-makers make informed investment choices. The report also highlights
emerging trends, key drivers, challenges, and opportunities in the Global
Automotive Engineering Services Market.
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