Automotive Engineering Services Market

Automotive Engineering Services Industry - Forthcoming Trends to Fuel the Global Growth

The global automotive engineering services market is projected to grow from an estimated USD 153.2 billion in 2022 to USD 243.9 billion by 2028, registering a CAGR of 8.1%. Leading automotive engineering services (AES) providers have set up their R&D infrastructure across the world to provide AES such as concept/research, designing, prototyping, system integration, testing, among others to OEMs and component manufactures. Factors like rising demand for zero-emission vehicles and strong government support have led to an increased demand of AES among automakers. Europe is expected to be impacted by ongoing geo-political problems in the region along with the upcoming recession. This will lead to a change in R&D investment plans of OEMs and AES providers.

The automotive engineering services industry is undergoing rapid evolution, driven by emerging trends and global forecasts.

Emerging trends in the global Automotive Engineering Services Industry are:

  • Electric and Autonomous Vehicles
  • Connected Vehicles
  • Advanced Driver Assistance Systems (ADAS)
  • Vehicle Lightweighting and Material Innovation
  • Sustainability and Green Technologies
  • Digital Twin Technology
  • Collaborative and Agile Development
  • Globalization and Outsourcing

These trends are driving significant transformation within the automotive engineering services industry, presenting both challenges and opportunities for companies operating in this space.

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  • Electric and Autonomous Vehicles: Engineering services specializing in electric drivetrain development, battery technology, software development for autonomous systems, sensor integration, and vehicle-to-everything (V2X) communication are in high demand due to the shift towards electric vehicles (EVs) and autonomous vehicles (AVs).
  • Connected Vehicles: The development of linked vehicle solutions is becoming a growing priority for automotive engineering services due to the widespread adoption of IoT (Internet of Things) technologies. The aforementioned services pertain to telematics, infotainment systems, OTA updates, and cybersecurity, with the aim of guaranteeing the dependability and security of vehicles that are connected.
  • Advanced Driver Assistance Systems (ADAS): Modern cars are increasingly coming equipped with ADAS features including automated emergency braking, adaptive cruise control, and lane-keeping assistance. The development and integration of these cutting-edge safety systems, as well as improving their precision and dependability via sensor fusion and AI algorithms, are the main goals of automotive engineering services.
  • Vehicle Lightweighting and Material Innovation: Automobile makers are utilizing lightweight materials like carbon fiber, aluminum, and sophisticated high-strength steel in an effort to cut emissions and increase fuel economy. To achieve lightweighting goals without sacrificing performance or safety, engineering services are essential for material selection, manufacturing process development, and structural design optimization.
  • Sustainability and Green Technologies: The automobile industry is adopting more environmentally friendly technologies including electric propulsion, hydrogen fuel cells, and renewable materials as a result of an increasing emphasis on sustainability. The development and use of sustainable solutions for the whole vehicle lifespan, encompassing design, production, and end-of-life recycling, is the main goal of engineering services.
  • Digital Twin Technology: Automotive engineers are increasingly using digital twin technology, which makes virtual copies of real assets, for predictive maintenance, performance improvement, and design validation. This speeds up development timelines and raises the caliber of the final product by enabling engineers to model and examine multiple situations in a virtual setting.
  • Collaborative and Agile Development: Cross-functional teams are collaborating to quickly iterate and innovate in the field of automotive engineering, which is becoming more agile and collaborative. Scrum and kanban are two examples of agile approaches that are being used to improve development processes and react swiftly to shifting market demands.
  • Globalization and Outsourcing: An increasing number of domestic and foreign specialized organizations and suppliers are being hired to provide engineering services as the automotive industry grows more worldwide. This shortens the time it takes for new products and technology to reach the market, lowers costs, and gives automakers access to specialist knowledge.

Related Report

Automotive Engineering Services Market by Application, Service Type, Location (In-house, Outsource), Vehicle Type (Passenger Cars, Commercial Vehicles), Nature Type (Body Leasing, Turnkey), Propulsion (ICE, Electric) and Region - Global Forecast to 2028


Automotive Engineering Services Market Size,  Share & Growth Report
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AT 7228
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