USD 118.06 Billion
Aerospace Engineering Services Outsourcing Market Size, Share, and Growth Analysis
Global Aerospace Engineering Services Outsourcing Market Size, Share & Trends Analysis Report, By Location (On-shore, Off-shore), By Component (Hardware, Software), By Function, By Service, By Region, And Segment Forecast, 2025-2032
Report ID:
SQMIG20A2320 |
Region:
Global |
Published Date: April, 2025
Pages:
172
|Tables:
118
|Figures:
71
Format -
Aerospace Engineering Services Outsourcing Market Insights
Global Aerospace Engineering Services Outsourcing Market size was valued at USD 118.06 Billion in 2023 and is poised to grow from USD 147.82 Billion in 2024 to USD 832.39 Billion by 2032, growing at a CAGR of 25.2% during the forecast period (2025-2032).
Growing backlogs in aircraft production, demand for skilled talent, digital transformation of the aerospace industry, high emphasis on sustainable aviation R&D, and focus on core competencies by OEMs (original equipment manufacturers) are driving revenue generation.
Global aircraft manufacturers face growing order backlogs due to rising air travel demand, prompting them to outsource engineering services to scale efficiently. Low labor costs and availability of skilled professionals in countries such as India, Mexico, and Poland are also expected to bolster the global aerospace engineering services outsourcing market growth. To remain agile and competitive, aerospace OEMs and Tier 1 suppliers are focusing their internal resources on high-value core functions, while outsourcing other tasks.
On the contrary, data security and intellectual property concerns, dependency on vendor capabilities, fluctuations in aerospace budgets, and limited domain expertise in some regions are projected to hamper aerospace engineering services outsourcing sales across the forecast period and beyond.
Which Novel Technologies are Changing Aerospace Engineering Business?
Artificial Intelligence (AI), Machine Learning (ML), and Robotic Process Automation (RPA) are being increasingly adopted by aerospace engineering services outsourcing providers to automate repetitive design validation, simulation, and report generation tasks. These technologies not only cut costs but also reduce human error and enhance productivity. Aerospace firms are leveraging AI-powered engineering analytics and predictive maintenance models via aerospace engineering services outsourcing partnerships. This technological shift is also enabling faster iteration during product development. As AI adoption increases across aerospace workflows, service providers are developing proprietary AI tools to attract clients, establishing tech capabilities as a key differentiator in the competitive aerospace engineering services outsourcing market.
Can Startups Shake Up the Aerospace engineering services outsourcing Industry?
While getting in the aerospace outsourcing business is quite a tough feat to achieve, there are multiple startups who have succeeded in doing so. Here are some startups that could change the future of aerospace outsourcing in the long run.
- StroNvar Aerospace: The 2025-founded startup is a supply chain company focusing on creating a high-performing group serving the aero-engine supply chain. The United States-based company is expected to bolster the outsourcing landscape for multiple aerospace companies going forward. In February 2025, the company was backed by Blackstone for the acquisition of Electro Methods Inc., a supplier of critical Fabricated Assemblies to aero-engine OEMs.
Market snapshot - (2025-2032)
Global Market Size
Largest Segment
Hardware
Fastest Growth
Software
Growth Rate
25.2% CAGR
Global Aerospace Engineering Services Outsourcing Market ($ Bn)
Country Share for North America Region (%)
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Aerospace Engineering Services Outsourcing Market Segments Analysis
Which Function Brings in the Most Business for Market Players?
The maintenance process segment is estimated to account for a prominent share of the global aerospace engineering services outsourcing industry in the future. Need for periodic maintenance and repairs for multiple aircrafts around the world allows this segment hold sway over others. Rising emphasis on reducing downtimes and increasing reliability of service delivery are also helping this segment bring in the most revenue going forward.
On the other hand, the demand for aerospace engineering services outsourcing for design is slated to rise at a robust pace in the future. Rapid technological advancements in aerospace components have led to high demand for novel design approaches. Need for incorporation of new innovative technologies in aircraft also bolsters the demand for better design services.
Which Component is Aerospace Engineering Services Outsourcing Used Extensively For?
Hardware components are expected to account for the largest global aerospace engineering services outsourcing market share in the future. High reliance of aerospace industry on hardware components to ensure optimal functionality are helping this segment bring in the most revenue. Airframes, engines, avionics, raw materials, forgings, and castings are some of the most commonly outsourced hardware components in this industry.
The software segment is slated to emerge as the fastest growing segment over the coming years. Rising use of Computer-Aided Design (CAD), Computer-Aided Manufacturing (CAM), and simulation tools in aerospace engineering are helping this segment generate new business scope in the long run.
Global Aerospace Engineering Services Outsourcing Market By Component
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Aerospace Engineering Services Outsourcing Market Regional Insights
Why North America Leads Aerospace Engineering Services Outsourcing Demand?
Presence of a highly developed aerospace ecosystem in this region is primarily helping it hold sway over other regions. Availability of a developed infrastructure to support collaborative engineering and development of aircraft and booming commercial aviation activity are slated to bolster the demand for aerospace engineering services outsourcing in the future.
Aerospace Engineering Services Outsourcing Market in United States
The United States is home to leading aerospace companies such as Boeing and Lockheed Martin. High emphasis on outsourcing from these companies to manage labor shortages and offset high R&D costs is slated to make this a top country for aerospace engineering services outsourcing providers. OEMs in the country are partnering with aerospace engineering services outsourcing companies to achieve their sustainable aviation goals.
Aerospace Engineering Services Outsourcing Market in Canada
The aerospace industry of Canada is highly dependent on exports, which is why most companies opt for aerospace engineering services outsourcing to stay cost-competitive. Green aviation and unmanned aerial vehicles (UAVs) are expected to emerge as popular end users of aerospace engineering services outsourcing as emphasis on advanced prototyping rises in the country.
How Will Aerospace Engineering Services Outsourcing Demand Fare in Asia Pacific?
Demand for aerospace engineering services outsourcings is estimated to rise at an impressive CAGR across the study period in this region. Growing number of air travelers and need for new commercial aircraft to accommodate the same are slated to boost the adoption of aerospace engineering services outsourcing going forward. High investments in the R&D of aerospace technologies and increasing government support for the same are also slated to offer new business scope in the long run.
Aerospace Engineering Services Outsourcing Market in China
China is currently focusing on indigenous aircraft programs and is opting for aerospace engineering services outsourcing to fill in the local engineering gaps. Partnerships with domestic and foreign aerospace engineering services outsourcing providers are expected to be popular in the country to support rapid R&D scaling. Aerospace engineering services outsourcing companies are slated to invest in the R&D of avionics, systems integration, and electric propulsion technologies in China through 2032.
Aerospace Engineering Services Outsourcing Market in India
Presence of a massive talent pool, cost efficiency, and established aerospace clusters in Bengaluru and Hyderabad are making India a rewarding country for market players. Major aerospace companies such as Airbus and Boeing have launched their engineering centers in the country to fast track design, stress analysis, and MRO engineering.
Why Should Aerospace engineering services outsourcing Companies Invest in Europe?
Europe has a long history of aerospace engineering and it is the home of some of the most prominent aerospace manufacturing companies such as Rolls Royce and Airbus. Presence of a skilled engineering workforce along with a developed aerospace engineering ecosystem are slated to create new opportunities in the European region going forward. Availability of a developed airline industry also supplements high demand for aerospace engineering services outsourcing.
Aerospace Engineering Services Outsourcing Market in United Kingdom
Emphasis of aerospace companies on streamlining their operations post-Brexit is helping boost aerospace engineering services outsourcing demand in the United Kingdom. Growing emphasis on outsourcing the R&D of hybrid-electric and autonomous aircraft to reduce aviation emissions are also offering new business scope.
Aerospace Engineering Services Outsourcing Market in Germany
High demand for outsourcing complex aerostructure and embedded systems engineering to maintain efficiency and innovation in the country is helping it generate more revenue for market players. Quick adoption of digital manufacturing and Industry 4.0 compliance in aerospace in Germany is also slated to bolster the adoption of aerospace engineering services outsourcing in the long run.
Global Aerospace Engineering Services Outsourcing Market By Geography
- Largest
- Fastest
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Aerospace Engineering Services Outsourcing Market Dynamics
Drivers
Digital Transformation and Industry 4.0 Adoption
- Rapidly increasing adoption of digital technologies such as digital twins, AI, and simulation-based design in aircraft manufacturing is creating new opportunities for aerospace engineering services outsourcing companies. These third-party service providers offer advanced capabilities in software development, digital modeling, and analytics—technologies that are key to the future of aerospace innovation. By outsourcing to digital-first aerospace engineering services outsourcing firms, OEMs can implement Industry 4.0 solutions faster and more cost-effectively.
Increased R&D in Sustainable Aviation
- High investments in R&D of sustainable aviation technologies such as electric propulsion, hydrogen fuel, and lightweight composite materials also promotes business. Aerospace engineering services outsourcing companies support sustainable initiatives through advanced simulations, structural redesign, and thermal systems analysis. Their expertise enables faster prototyping and innovation without straining internal resources, which ultimately drives the global aerospace engineering services outsourcing market outlook.
Restraints
Fluctuating Aerospace Budgets
- The budget of aerospace companies and businesses is influenced by economic factors, fuel prices, and geopolitical conditions. Fluctuating defense and commercial aerospace budgets can lead to sudden project cancellations or slowdowns, affecting outsourcing contracts. During downturns, companies may scale back on engineering services or pull tasks in-house to cut costs. This unpredictability is slated to impede aerospace engineering services outsourcing adoption.
Dependency on Vendor Capabilities
- High reliance on external vendors for all engineering services can create complications for aerospace companies through vendor lock-in. If the outsourced partner lacks scalability or faces internal disruptions, it can delay project delivery and increase costs. Companies also risk knowledge loss and reduced internal engineering competency over time, making them more dependent on third parties.
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Aerospace Engineering Services Outsourcing Market Competitive Landscape
Aerospace engineering services outsourcing manufacturers should focus on utilization of advanced manufacturing practices and collaborative engineering to boost business scope. Aerospace engineering services outsourcing companies can also focus on integration of advanced technologies to improve the safety and functionality of their products as per this global aerospace engineering services outsourcing market forecast.
Top Player’s Company Profiles
- Altair Engineering Inc.
- Alten Group
- Capgemini
- Bertrandt AG
- EWI
- Honeywell International Inc.
- ITK Engineering GmbH
- L&T Technology Services Limited
- LISI GROUP
- Teledyne Technologies Incorporated
- BAE Systems
- L3Harris Technologies, Inc.
- Elbit Systems Ltd.
- RTX
Recent Developments
- In September 2024, Honeywell, a renowned multinational organization announced that it had completed the acquisition of CAES Systems Holdings LLC. The transaction was valued at USD 1.9 billion and carried out all in cash to help Honeywell improve its space and defense production portfolio, as it expands its business scope.
- In May 2024, L&T Technology Services, a leading provider of engineering services and solutions inaugurated a new Simulation Centre of Excellence for Airbus. The new simulation centre is located he LTTS state-of-the-art campus in Bangalore to enhance support for Airbus aircraft structural simulation activities across its units around the world.
Aerospace Engineering Services Outsourcing Key Market Trends
- Demand for Full Lifecycle Outsourcing: Aerospace engineering services outsourcing manufacturers should focus on offering full product lifecycle support going forward. Adoption of this aerospace engineering services outsourcing market trend can help enhance efficiency, ensure faster time-to-market, and reduce in-house overhead. Focus of OEMs to become more agile and focus on innovation while delegating engineering-heavy processes is slated to create new business scope via this trend.
- Cloud-Based Collaborative Engineering Platforms: Aerospace engineering services outsourcing companies are expected to invest in the R&D of collaborative engineering platforms. Cloud integration allows real-time updates, collaborative simulation, and secure sharing of large CAD files across geographies. ESO firms are integrating with clients’ digital twins and digital thread systems, enhancing traceability and version control.
Aerospace Engineering Services Outsourcing Market SkyQuest Analysis
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
As per SkyQuest analysis, rising investments in the R&D of sustainable aviation and growing digital transformation of aerospace industry are expected to drive the aerospace engineering services outsourcing demand over the coming years. However, dependency on vendor capabilities and fluctuations in aerospace budgets are estimated to hamper the demand for aerospace engineering services outsourcings across the forecast period. North America is projected to hold sway over the global aerospace engineering services outsourcing market share in the long run owing to high investments in R&D of novel aerospace technologies in the United States. Full lifecycle outsourcing and development of collaborative engineering platforms are estimated to create new opportunities in the long run.
| Report Metric | Details |
|---|---|
| Market size value in 2023 | USD 118.06 Billion |
| Market size value in 2032 | USD 832.39 Billion |
| Growth Rate | 25.2% |
| Base year | 2024 |
| Forecast period | (2025-2032) |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
|
| Customization scope | Free report customization with purchase. Customization includes:-
|
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Table Of Content
Executive Summary
Market overview
- Exhibit: Executive Summary – Chart on Market Overview
- Exhibit: Executive Summary – Data Table on Market Overview
- Exhibit: Executive Summary – Chart on Aerospace Engineering Services Outsourcing Market Characteristics
- Exhibit: Executive Summary – Chart on Market by Geography
- Exhibit: Executive Summary – Chart on Market Segmentation
- Exhibit: Executive Summary – Chart on Incremental Growth
- Exhibit: Executive Summary – Data Table on Incremental Growth
- Exhibit: Executive Summary – Chart on Vendor Market Positioning
Parent Market Analysis
Market overview
Market size
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- SWOT Analysis
KEY MARKET INSIGHTS
- Technology Analysis
- (Exhibit: Data Table: Name of technology and details)
- Pricing Analysis
- (Exhibit: Data Table: Name of technology and pricing details)
- Supply Chain Analysis
- (Exhibit: Detailed Supply Chain Presentation)
- Value Chain Analysis
- (Exhibit: Detailed Value Chain Presentation)
- Ecosystem Of the Market
- Exhibit: Parent Market Ecosystem Market Analysis
- Exhibit: Market Characteristics of Parent Market
- IP Analysis
- (Exhibit: Data Table: Name of product/technology, patents filed, inventor/company name, acquiring firm)
- Trade Analysis
- (Exhibit: Data Table: Import and Export data details)
- Startup Analysis
- (Exhibit: Data Table: Emerging startups details)
- Raw Material Analysis
- (Exhibit: Data Table: Mapping of key raw materials)
- Innovation Matrix
- (Exhibit: Positioning Matrix: Mapping of new and existing technologies)
- Pipeline product Analysis
- (Exhibit: Data Table: Name of companies and pipeline products, regional mapping)
- Macroeconomic Indicators
COVID IMPACT
- Introduction
- Impact On Economy—scenario Assessment
- Exhibit: Data on GDP - Year-over-year growth 2016-2022 (%)
- Revised Market Size
- Exhibit: Data Table on Aerospace Engineering Services Outsourcing Market size and forecast 2021-2027 ($ million)
- Impact Of COVID On Key Segments
- Exhibit: Data Table on Segment Market size and forecast 2021-2027 ($ million)
- COVID Strategies By Company
- Exhibit: Analysis on key strategies adopted by companies
MARKET DYNAMICS & OUTLOOK
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- Regulatory Landscape
- Exhibit: Data Table on regulation from different region
- SWOT Analysis
- Porters Analysis
- Competitive rivalry
- Exhibit: Competitive rivalry Impact of key factors, 2021
- Threat of substitute products
- Exhibit: Threat of Substitute Products Impact of key factors, 2021
- Bargaining power of buyers
- Exhibit: buyers bargaining power Impact of key factors, 2021
- Threat of new entrants
- Exhibit: Threat of new entrants Impact of key factors, 2021
- Bargaining power of suppliers
- Exhibit: Threat of suppliers bargaining power Impact of key factors, 2021
- Competitive rivalry
- Skyquest special insights on future disruptions
- Political Impact
- Economic impact
- Social Impact
- Technical Impact
- Environmental Impact
- Legal Impact
Market Size by Region
- Chart on Market share by geography 2021-2027 (%)
- Data Table on Market share by geography 2021-2027(%)
- North America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- USA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Canada
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Europe
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Germany
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Spain
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- France
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- UK
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Europe
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Asia Pacific
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- China
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- India
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Japan
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Korea
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Asia Pacific
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Latin America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Brazil
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of South America
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Middle East & Africa (MEA)
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- GCC Countries
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Africa
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of MEA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
KEY COMPANY PROFILES
- Competitive Landscape
- Total number of companies covered
- Exhibit: companies covered in the report, 2021
- Top companies market positioning
- Exhibit: company positioning matrix, 2021
- Top companies market Share
- Exhibit: Pie chart analysis on company market share, 2021(%)
- Total number of companies covered
Methodology
For the Aerospace Engineering Services Outsourcing Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Aerospace Engineering Services Outsourcing Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Analyst Support
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Aerospace Engineering Services Outsourcing Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Aerospace Engineering Services Outsourcing Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
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