Engines Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented, By Speed Type (High Speed, Medium Speed and Low Speed), By Power Rating (Below 100 hp,101-500 hp, 501-1000 hp and Above 1000 hp), By Type (Internal Combustion engine, External Combustion engine, Reciprocating Engine, Rotary Engine, Air Cooled Engine and others), By End-User (Power Generation, Marines, Locomotives, Mining, Oil & Gas, Construction and Others), By Region & Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 210.18 Billion
CAGR (2026-2031)	3.76%
Fastest Growing Segment	Above 1000 hp
Largest Market	North America
Market Size (2031)	USD 262.28 Billion

Market Overview

The Global Engines Market will grow from USD 210.18 Billion in 2025 to USD 262.28 Billion by 2031 at a 3.76% CAGR. The Global Engines Market involves the production and distribution of mechanical systems designed to convert potential energy into mechanical force for powering vehicles, aircraft, marine vessels, and industrial machinery. The expansion of this sector is fundamentally supported by the escalating demand for commercial transport fleets to facilitate global trade logistics and the critical necessity for reliable backup power generation in developing industrial infrastructures. Furthermore, the sustained requirement for heavy-duty agricultural equipment to meet rising food security targets continues to bolster the procurement of high-performance powertrains across major economies.

Nevertheless, the market encounters a significant challenge regarding increasingly stringent environmental regulations and the accelerating transition toward electrification which threatens traditional internal combustion engine volumes. This regulatory pressure is evident in recent industrial performance metrics where economic and compliance strains have dampened output in key regions. According to the European Automobile Manufacturers’ Association, in 2025, new commercial vehicle registrations for vans and trucks within the European Union decreased by 8.2 percent and 9.8 percent respectively during the first three quarters. This contraction underscores the substantial hurdles manufacturers must navigate to maintain growth amidst the global shift to sustainable energy platforms.

Key Market Drivers

The escalating global production of passenger and commercial vehicles serves as a primary catalyst for the engines market, necessitating higher volumes of internal combustion and hybrid powertrains. As automotive hubs ramp up assembly lines to meet export and domestic needs, the procurement of engine units has intensified to sustain supply chains. This trend is most visible in Asian markets, where manufacturing output continues to anchor the global supply. According to the China Association of Automobile Manufacturers, January 2025, in its annual industry performance report, China's total automobile output reached 31.28 million units in 2024, a 3.7 percent increase year-on-year. This production volume underscores the immense scale of the sector, a sentiment reflected in broader market financials. According to Cummins, in 2025, the company reported full-year 2024 revenues of $34.1 billion, highlighting the sustained value and demand stability within the commercial power segment.

Simultaneously, the resurgence in commercial air traffic and aircraft fleet expansion is reinvigorating demand for high-performance aerospace propulsion systems. Airlines are actively upgrading fleets to restore capacity and improve fuel efficiency, triggering a new cycle of engine orders and aftermarket services. This recovery provides a critical revenue stream for manufacturers delivering complex turbofan technologies. According to Airbus, January 2025, in the 'Airbus reports 766 commercial aircraft deliveries in 2024' press release, the manufacturer delivered 766 aircraft, a 4 percent rise from the previous year. This uptick confirms the aviation sector's recovered trajectory, ensuring steady demand for the specialized engines essential to modern airframes.

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Key Market Challenges

The Global Engines Market faces substantial headwinds due to increasingly stringent environmental regulations and the accelerating transition toward electrification. This regulatory landscape forces manufacturers to divert massive capital expenditure away from traditional internal combustion engine development to fund the research and production of zero-emission alternatives. Consequently, established supply chains are disrupted as automakers undergo complex factory retooling to accommodate electric powertrains, leading to significant operational downtime and a deliberate scaling back of fossil-fuel-based engine volumes before electric capacities are fully ramped up.

This structural friction is directly impacting manufacturing output in major automotive hubs, creating a period of contraction rather than growth. For example, according to the Society of Motor Manufacturers and Traders, in the first ten months of 2025, UK car and van production declined by 17 percent compared to the same period in the previous year. This sharp decrease illustrates the immediate toll of the transition, as the industry struggles to maintain legacy production levels while simultaneously navigating the costly and disruptive shift to sustainable energy platforms.

Key Market Trends

The Commercialization of Hydrogen Internal Combustion Engines is rapidly emerging as a viable decarbonization pathway for heavy-duty applications where battery electrification remains operationally limited by weight and range constraints. Major powertrain manufacturers are retrofitting legacy engine architectures to combust hydrogen, thereby preserving established mechanical supply chains while achieving near-zero emission profiles essential for long-haul logistics and industrial equipment. This technological pivot is being accelerated through high-value strategic alliances focused on refining fuel delivery systems. According to Forbes, July 2025, in the 'The Combustion Engine Strikes Back: Volvo Reimagines Hydrogen' article, Volvo Group solidified this trend by finalizing a joint venture to commercialize high-pressure direct injection systems for hydrogen engines, supported by an initial investment of $28 million.

Simultaneously, the Adoption of Dual-Fuel Methanol and Ammonia Marine Engines is fundamentally altering the maritime propulsion landscape as shipping operators aggressively pursue compliance with International Maritime Organization emission targets. This trend involves the deployment of flexible platforms capable of switching between conventional bunker fuels and green alternatives like methanol, effectively hedging against fuel availability risks during the infrastructure transition. The scale of this shift is reflected in the substantial order volume for alternative-fuel tonnage. According to Offshore Energy, January 2025, in the 'DNV: LNG dominated alternative-fuel ship orderbook in exceptional newbuilding year' article, the global shipping industry ordered 166 methanol-fueled vessels in 2024, which accounted for 32 percent of the total alternative-fuel vessel orderbook.

Segmental Insights

The Above 1000 hp segment is identified as the fastest-growing category within the Global Engines Market. This expansion is primarily driven by increasing requirements in heavy-duty sectors such as marine, oil and gas, and large-scale material handling, where high torque and continuous reliability are essential. Additionally, the industry is witnessing a surge in demand for high-capacity engines that support hybrid power systems and comply with rigorous emission standards. Consequently, manufacturers are prioritizing the development of these powerful units to meet the complex operational needs of global infrastructure and industrial projects.

Regional Insights

North America maintains a leading position in the global engines market primarily due to the substantial manufacturing capacity of the automotive and aerospace sectors. The region experiences consistent demand for engines to support commercial transportation and power generation requirements. Furthermore, stringent emission standards established by the United States Environmental Protection Agency compel manufacturers to develop compliant technologies, thereby accelerating fleet modernization. This regulatory environment, combined with robust industrial infrastructure development, ensures sustained market expansion across the United States and Canada.

Recent Developments

• In January 2025, a global power leader, in partnership with a major truck manufacturer, launched a new 6.7-liter turbo diesel engine system designed for heavy-duty pickup trucks. The newly introduced engine featured significant advancements, including enhanced responsiveness, higher power output, and improved fuel efficiency, while being certified to meet rigorous emissions standards. This product launch coincided with the official extension of the companies' long-standing supply partnership, which was renewed to ensure the continued delivery of advanced diesel powertrains for the commercial vehicle market through 2030. The collaboration underscored a commitment to innovation in internal combustion engine technology for heavy-duty applications.
• In December 2024, a prominent energy solution provider commenced the first full-scale testing of a two-stroke ammonia engine at its research center in Copenhagen. The company reported that this development marked a pivotal milestone in the maritime industry's transition to alternative fuels, building upon successful data from earlier single-cylinder tests. This comprehensive testing phase focused on validating combustion stability, emissions levels, and the reliability of safety systems under operational conditions. The initiative aimed to finalize the development of a commercial dual-fuel ammonia engine, which the company targeted for delivery to the market for newbuild vessels to support shipping decarbonization.
• In June 2024, a leading technology group launched the global energy market's first large-scale 100% hydrogen-ready engine power plant to support the transition to net-zero power systems. This advanced engine platform was engineered to be fully convertible to run on pure hydrogen, directly addressing the critical need for flexible power generation to balance fluctuating renewable energy sources like wind and solar. The organization stated that this technological breakthrough would enable the decarbonization of the energy sector by providing a future-proof solution capable of operating on sustainable fuels. The launch represented a significant step beyond existing technology which utilized hydrogen blends.
• In May 2024, three major Japanese automakers announced a strategic collaboration to develop a new generation of internal combustion engines specifically tailored for electrification. The companies committed to creating distinct signature powertrains, including inline-four, rotary, and boxer configurations, which would be compatible with carbon-neutral fuels such as liquid hydrogen, biofuels, and synthetic fuels. This joint effort aimed to optimize the integration of engines with electric drive units, ensuring compact vehicle packaging and improved aerodynamic performance. The partners emphasized that this multi-pathway approach would allow them to pursue decarbonization while maintaining the unique driving characteristics associated with their respective brands.

Key Market Players

• Caterpillar Inc.
• Wartsila Corporation
• Cummins Inc.
• Man Energy Solutions
• Siemens Energy AG
• Mitsubishi Heavy Industries Ltd.
• Kawasaki Heavy Industries Ltd.
• Liebherr International AG
• Hyundai Heavy Industries Co. Ltd.
• Rolls-Royale Holdings Plc.

By Speed Type	By Power Rating	By Type	By End-User	By Region
High Speed Medium Speed and Low Speed	Below 100 hp 101-500 hp 501-1000 hp and Above 1000 hp	Internal Combustion engine External Combustion engine Reciprocating Engine Rotary Engine Air Cooled Engine and others	Power Generation Marines Locomotives Mining Oil & Gas Construction and Others	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Engines Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Engines Market, By Speed Type:

• High Speed
• Medium Speed and Low Speed

• Engines Market, By Power Rating:

• Below 100 hp
• 101-500 hp
• 501-1000 hp and Above 1000 hp

• Engines Market, By Type:

• Internal Combustion engine
• External Combustion engine
• Reciprocating Engine
• Rotary Engine
• Air Cooled Engine and others

• Engines Market, By End-User:

• Power Generation
• Marines
• Locomotives
• Mining
• Oil & Gas
• Construction and Others

• Engines Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE