Global Automotive Engineering Services Outsourcing Market

Automotive Engineering Services Outsourcing Market Size, Share, Growth Analysis, By Application (Powertrain & After-Treatment, Infotainment & Connectivity), By Service (Prototyping, Designing), By Location (On-Shore, Off-Shore), By Region -Industry Forecast 2025-2032


Report ID: SQMIG45B2190 | Region: Global | Published Date: February, 2025
Pages: 189 | Tables: 93 | Figures: 71

Automotive Engineering Services Outsourcing Market Insights

Global Automotive Engineering Services Outsourcing (ESO) market size was valued at USD 108.69 billion in 2023 and is poised to grow from USD 119.89 billion in 2024 to USD 262.66 billion by 2032, growing at a CAGR of 10.3% in the forecast period (2025-2032).

The rapid need of advanced and improved connectivity solutions from automotive manufacturing houses is creating global automotive engineering services outsourcing market growth opportunities. Moreover, demand for enhanced connectivity solutions such as navigation, smart infotainment, passenger safety, and remote diagnostics is enhancing market growth prospects. The growing technological skills of Engineering Service Providers (ESPs) in providing research and development (R&D) and product innovation in their offerings for vehicle positioning, connected automobiles, and guidance systems are expected to fuel the market growth. In addition, the increasing initiatives by governments to deploy green vehicles to reduce harmful gas discharges are also propelling the market growth. The automotive ESO industry developed from mechanical services provision to high-tech solutions integration, including Artificial Intelligence (AI), Internet of Things (IoT), and many others.

Due to the rapid integration of Information Technology (IT) in automobiles, advanced services rose with the achievement of commutation objectives and comfort, safety, and ease of use for consumers. The increasing trend of OEMs towards digitalized solutions is predicted to open doors for growth in the market. This is because end-users are gradually changing their paradigms toward more technological solutions. The ACES disruptions are a digitalized model adopted by key players in the market, allowing advanced mobility standards to improve consumer's interaction and experience with vehicles.

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Global Automotive Engineering Services Outsourcing (ESO) market size was valued at USD 108.69 billion in 2023 and is poised to grow from USD 119.89 billion in 2024 to USD 262.66 billion by 2032, growing at a CAGR of 10.3% in the forecast period (2025-2032).

Leading companies that focus on innovation and strategic alliances form the competitive landscape of the global automotive engineering services outsourcing (ESO) industry. Businesses are investing in cutting-edge technology such as autonomous driving, electric cars, and green solutions to meet changing consumer needs. Competitive factors include cost effectiveness, knowledge of cutting-edge technology, and customized services; Asia Pacific is becoming known as a center for highly qualified, reasonably priced engineering solutions. 'Capgemini SE', 'AVL List GmbH', 'Alten Group', 'Bertrandt AG', 'AKKA Technologies', 'HCL Technologies Ltd.', 'Tata Consultancy Services (TCS)', 'Tech Mahindra Limited', 'L&T Technology Services Limited', 'Infosys Limited', 'Ricardo Plc', 'P3 Group', 'FEV Group GmbH', 'IAV GmbH', 'Wipro Limited'

Electrification and self-driving vehicles justify the growing demand for specific engineering skills. In such a competitive world, automotive companies are outsourcing their engineering services to take proper advantage of severe environmental regulations in developing sophisticated technologies such as electric drivetrains, battery management systems, and autonomous driving solutions.

Improved Leverage of Digital Engineering Tools: Outsourcing techniques are evolving with the help of advanced digital engineering tools such as computer-aided design (CAD), simulation software, and virtual prototyping. With these technologies, suppliers can offer more accurate and efficient solutions, which reduces development time and enhances the overall quality of engineering services outsourced.

North America is the leading market for automotive engineering services outsourcing (ESO) with a revenue share of more than 21% in 2024, led by rapid technological advancements and increased adoption of electric and autonomous vehicles. Innovation and research and development are high on the priority list of this region, making it a competitive market where companies seek specialized engineering expertise to remain competitive. This increasing focus on developing next generation vehicles has created intense demand for leading-edge ESO providers. The market player keeps updating and enriching service with the focus of improving customers' experience, who optimize their expenditures and increase operational efficiency. Another driver of further accelerating the development in North American is the co-operations built between OEM and ESO suppliers.

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Global Automotive Engineering Services Outsourcing Market

Report ID: SQMIG45B2190

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