Global Automotive Engineering Service Providers (ESP) Market Is Projected to Grow to USD 7.41 Billion by 2025, at a CAGR of 10% Over The Forecast Period 2021 to 2025

October 08, 2021, New York, USA -

Automotive Engineering Service Providers (ESP): Introduction

Engineering solutions are offered to the different elements along the entire automotive industry value chain by the Automotive Engineering Service Providers (ESP). The services they offered include the fabricating, development, designing, and testing of numerous elements, such as electrical, software, mechanical, electronics, and safety. Basically, they provide all the services which are involved at each stage of the production, from conceptualization to production. 

The Global Automotive Engineering Service Providers (ESP) Market Forecast: 

The Global Automotive Engineering Service Providers (ESP) Market is projected to expand by $7.41 billion between 2021 and 2025, with a CAGR of 10 percent over the forecast timeframe. Factors like the development of autonomous vehicles as well as the development of a 5G technology within the automotive industry, OEM and Government focus in electric cars, the use of cutting edge technology, lightweight vehicles, and passengers and vehicles safety concerns are driving growth for the automotive engineering services market. 

The market growth is driven by customers growing needs and expectations from the specialized IT and core automobile engineering services contains connected cars and vehicle-to-vehicle and infrastructure communication. Additionally, increasing demand for vehicles that use less fuel as well as the ever more strict emission standards is also driving the market's expansion. Increased competition and a shorter time to market are also pushing the growth of the market.

However, manufacturers of original equipment collaborate with engineering services (ESO) will increase demand in the coming years.

On the other hand, the demand for automotive ESO services is rising dramatically due to the growing capacities that are being developed by Engineering Service Providers (ESPs) to deliver product innovation as well as research and development in the field of the areas of vehicle positioning and technology for guidance, connectivity of vehicles, or autonomous vehicles. Asia Pacific region accounted for the biggest market share in 2019 and is predicted to maintain this trend throughout the forecast time.

The research team has looked into the M&A sector and discovered that not all turnkey businesses invest in small specialist capabilities; however, body-leasing companies are also adopting a more value-add strategy by acquiring more distinctive business models. In addition, some large corporations increasingly have expressed interest in investing in specialist ESPs to expand their knowledge set and to acquire expertise in cutting-edge areas such as electronic mobility and other alternative materials.

Japan has become one of the most well-known car manufacturers in the world because of the presence of large automobile manufacturers like Honda Motor Co., Ltd., Nissan Motor Corp., along Toyota Motor Corp. Because of the frugal labor across countries like Philippines, India, and China major automobile OEM’s is outsourced to these countries.

This has triggered the need for automotive engineering services for automobiles in the country and is an integral part of the APAC regional expansion.

Market Trend and Dynamics of the Global Automotive Engineering Service Providers (ESP) Market:

The rising demand for testing vehicles and the introduction of artificial intelligence and 5G connectivity will boost the demand for connected automotive services throughout the world. Major original equipment manufacturers around the world prefer in-house vehicle testing to ensure more efficient outcomes. In-house testing involves the use of components like sensors as well as IoT devices. These are likely to expand the automotive engineering service provider (ESP) market around the world. The increasing demand for connected vehicles around the globe, consisting of testing and simulation software, is an important factor in driving the market for automotive engineering services all over the world.

Increased competition among automobile service suppliers and components providers around the world is expected to boost the market for Automotive Engineering Service Providers (ESP) all over the world. Globally, major governments support service providers in developing efficient vehicles. This is expected to also increase the automotive engineering service market all over the world. An increase in the incorporation of connected services, electrification as well as autonomous driving will propel research and development. This is likely to increase the automotive engineering service provider market all over the world.

The Key Market Segmentation of the Global Automotive Engineering Service Providers (ESP) Market: 

Global Automotive Engineering Service Providers (ESP) Market can be divided into Service Types, Applications, Location Type, Vehicle Type, Propulsion Type, and Geographical landscapes, etc. 

Automotive Engineering Service Providers (ESP) Market Segmentation By Service Type:

Designing

Prototyping

System Integration

Testing

Automotive Engineering Service Providers (ESP) Market Segmentation By Application:

ADAS and Safety

Electrical, Electronics and Body Controls

Chassis

Connectivity Services

Interior, Exterior, and Body Engineering

Powertrain and Exhaust

Simulation

Automotive Engineering Service Providers (ESP) Market Segmentation By Location Type:

On-shore

Off-shore

Automotive Engineering Service Providers (ESP) Market Segmentation By Vehicle Type:

Passenger Vehicles

Commercial Vehicles

Automotive Engineering Service Providers (ESP) Market Segmentation By Propulsion Type:

IC Engine

Electric Vehicles

Hybrid Vehicles

Automotive Engineering Service Providers (ESP) Market Segmentation By Geographical Landscape:

North America

Europe

Asia Pacific

South America

The Middle East and Africa

Major Key Players in the Global Automotive Engineering Service Providers (ESP) Market Are:

AKKA Technologies SE

AVL List GmbH

Bertrandt AG

EDAG Engineering Group AG

HCL Technologies Ltd

Larsen & Toubro Ltd

Capgemini Service SAS

IAV

Harman International

Altran Technologies

Alten Cresttek

Robert Bosch GmbH

Alten Group

FEV Group GmbH

The Covid-19 Impact Analysis:

As the business impact of COVID-19 grows, the automotive engineering services providers (ESP) market for 2020-2024 is anticipated to experience negative and inferior growth, as the disease spreads to some regions and then plateaus in different regions.

The Global Automotive Engineering Service Providers (ESP) Market Report Highlights:

The majority of the automotive engineering market growth for service providers came from the powertrain industry. OEMs are working towards the creation of lighter and fuel-efficient engines. This creates significant potential business for ESPs. Additionally, the growing need for rigorous tests and verification methods of engine components and engines in order to meet stringent emission standards will fuel the worldwide automotive ESP market to expand in the powertrain sector.

The rising disposable income and introduction of new cars are leading to the automobile engineering service (ESP) provider market expansion in APAC. Furthermore, the region has the largest number of first-time car buyers. With the growing purchasing capacity in the region, consumers are shifting their focus not just on price but other aspects like the security of the vehicle, as well as the comfort and ease of driving. This will increase the sales of suppliers in the region. China, India, Japan, along South Korea are the key markets for automotive engineering services in APAC. The growth rate of the market in this region is more rapid than in other regions.

It is known that the global engineering and automotive service provider market is divided. AKKA Technologies SE, Larsen & Toubro Ltd., Ricardo Plc, AVL List GmbH, HCL Technologies Ltd., Bertrandt AG, Capgemini Service SAS, IAV GmbH Ingenieurgesellschaft Auto und Verkehr, EDAG Engineering Group AG, and Tech Mahindra Ltd. are some of the major market participants. To assist clients in improving their position in the market, the automotive engineering service market forecast report from providers offers an in-depth analysis of the market-leading players.