Global Automotive Engineering Services Market 2025-2035
Description
Automotive Engineering Services Market Size, Share & Trends Analysis Report by Vehicle Type (Passenger Cars, and Commercial Vehicles), by Service (Concept/Research, Designing, Prototyping, System Integration, and Testing), and by Application (ADAS and Safety, Electrical, Electronics, and Body Controls, Chassis, Connectivity Services, Interior, Exterior, and Body Engineering, Powertrain and Exhaust, Simulation, Battery Development and Management, Charger Testing, Motor Controls, and Others), Forecast Period (2025-2035)
Industry Overview
Automotive engineering services market was valued at $174.9 billion in 2024 and is projected to reach $399.3 billion by 2035, growing at a CAGR of 7.9% during the forecast period (2025-2035). The automotive engineering services market growth is primarily driven by the transition to electric mobility and the expanding penetration of advanced driver assistance systems (ADAS) by manufacturers. Manufacturers are investing in digital engineering tools in value-chain optimization to design and validate vehicles efficiently. Increasing regulatory emissions and safety requirements have increased demand for specialist engineering. OEMs can accelerate time-to-market and optimize development costs by leveraging engineering service providers that deliver specialized core R&D solutions.
Market Dynamics
Advanced Engineering Solutions Transforming Automotive Services
The automotive industry is undergoing rapid transformation, driven by the need for digital transformation and sustainable mobility. Engineering service offering differentiated solutions for all aspects of product design, simulation, and validation. For instance, KPIT Technologies is working with OEMs as partners in embedded software development and electric powertrain engineering. These services enable OEMs to reduce production lead times and handle increasing technical complexity. As vehicle architecture is rapidly more connected and software-driven, engineering partners are the core support in integrating ADAS and connectivity, rolling out over-the-air updates.
Strategic Collaborations Drive Electric Mobility Programs
As transition to electric vehicles is happening at a rapid pace globally, engineering services are crucial in making the EV development process scalable and efficient. For instance, Tata Elxsi is assisting automotive clients all over the globe with developing EV system designs, battery management systems, and vehicle control units. Tata Elxsi's end-to-end engineering service reduces risk and helps rapidly deliver EV programs. Strategic partnerships are important to traditional OEMs and EV start-ups exploring new technology landscapes in different ways. Collaborative approaches such as model-based development and digital twins have minimized development costs, prototypes and validation with performance reference benchmarks are expensive. These engineering innovations are enhancing the mobility value chain for innovation and creativity.
Market Segmentation
The rising utilization of technology in passenger vehicles is a prominent driver influencing the demand for automotive engineering services. The key market players are providing OEMs with unique offerings related to lightweight materials, emissions compliance, and electrification. For instance, Capgemini Engineering works with global automobile manufacturers to improve their next-generation vehicle platforms using model-based systems engineering. Likewise, L&T Technology Services has contributed to the development of autonomous driving software and infotainment systems in luxury passenger vehicles. As consumer expectations continue to evolve, automakers are seeking outside expertise to drive the succession of innovation cycles. This dynamic and changing environment continues to expand engineering service providers' influence in the passenger car space.
ADAS and Safety: A Key Segment in Market Growth
The market for automotive engineering services has expanded, and ADAS technology has been developed and used and a result of increased focus on road and vehicle safety laws. Automotive engineering services companies are working with vehicle manufacturers to develop functions, including lane keeping assistance, adaptive cruise control, automated emergency braking, and other functions. For instance, Tech Mahindra has full lifecycle engineering support for sensor fusion algorithms and embedded software development in ADAS systems. In the same way, AVL is providing simulators and validation services to create better performance and safety for driver assistance features.
Regional Outlook
The global automotive engineering services market is further divided by geography, including North America (the US and Canada), Europe (the UK, Germany, France, Italy, Spain, Russia, and the Rest of Europe), Asia-Pacific (India, China, Japan, South Korea, Australia and New Zealand, ASEAN Countries, and the Rest of Asia-Pacific), and the Rest of the World (the Middle East & Africa, and Latin America).
Rising Vehicle Production and Penetration of New Technologies in Asia-Pacific
The Asia-Pacific market continues to grow in automotive engineering services owing to rising vehicle production and penetration of new technologies. Countries including China, India, and South Korea are heavily funding R&D infrastructure that is accelerating a competitive innovation environment. Furthermore, a greater demand for electric vehicles, along with connectivity capabilities, has propelled unique engineering work by OEMs that is driving the development of new digital platforms and embedded systems capabilities. For instance, KPIT Technologies is assisting OEMs in software-defined vehicle engineering with battery management and electric powertrain development directly associated with the transition of mobility capabilities in the Asia-Pacific.
Europe Region Dominates the Market with Major Share
The automotive engineering services in Europe are growing exponentially owing to the high demand for electrification and autonomous vehicle technology systems. Regulatory demands around emissions and safety are driving OEMs to search for more advanced engineering solutions. The region's increasing focus on sustainability and technological innovation has led to a surge in OEM-service business collaborations and investments in digital twin, vehicle simulation, and e-mobility platform technologies to support new vehicle architectures. For instance, Bertrandt AG developed a specialized engineering project for electric and autonomous vehicles; this allows them to help accelerate design efficiencies while being compliant and sustainable.
Market Players Outlook
The major companies operating in the global automotive engineering services market include Alten Group, Bertrandt AG, Continental AG, HARMAN International Industries, Inc., and L&T Technology Services Ltd., among others. Market players are leveraging partnerships, collaborations, mergers and acquisition strategies for business expansion and innovative product development to maintain their market positioning.
Recent Developments
Industry Overview
Automotive engineering services market was valued at $174.9 billion in 2024 and is projected to reach $399.3 billion by 2035, growing at a CAGR of 7.9% during the forecast period (2025-2035). The automotive engineering services market growth is primarily driven by the transition to electric mobility and the expanding penetration of advanced driver assistance systems (ADAS) by manufacturers. Manufacturers are investing in digital engineering tools in value-chain optimization to design and validate vehicles efficiently. Increasing regulatory emissions and safety requirements have increased demand for specialist engineering. OEMs can accelerate time-to-market and optimize development costs by leveraging engineering service providers that deliver specialized core R&D solutions.
Market Dynamics
Advanced Engineering Solutions Transforming Automotive Services
The automotive industry is undergoing rapid transformation, driven by the need for digital transformation and sustainable mobility. Engineering service offering differentiated solutions for all aspects of product design, simulation, and validation. For instance, KPIT Technologies is working with OEMs as partners in embedded software development and electric powertrain engineering. These services enable OEMs to reduce production lead times and handle increasing technical complexity. As vehicle architecture is rapidly more connected and software-driven, engineering partners are the core support in integrating ADAS and connectivity, rolling out over-the-air updates.
Strategic Collaborations Drive Electric Mobility Programs
As transition to electric vehicles is happening at a rapid pace globally, engineering services are crucial in making the EV development process scalable and efficient. For instance, Tata Elxsi is assisting automotive clients all over the globe with developing EV system designs, battery management systems, and vehicle control units. Tata Elxsi's end-to-end engineering service reduces risk and helps rapidly deliver EV programs. Strategic partnerships are important to traditional OEMs and EV start-ups exploring new technology landscapes in different ways. Collaborative approaches such as model-based development and digital twins have minimized development costs, prototypes and validation with performance reference benchmarks are expensive. These engineering innovations are enhancing the mobility value chain for innovation and creativity.
Market Segmentation
- Based on the vehicle type, the market is segmented into passenger cars, and commercial vehicles.
- Based on the service, the market is segmented into concept/research, designing, prototyping, system integration, and testing.
- Based on the application, the market is segmented into ADAS and safety, electrical, electronics, and body controls, chassis, connectivity services, interior, exterior, and body engineering, powertrain and exhaust, simulation, battery development and management, charger testing, motor controls, and others.
The rising utilization of technology in passenger vehicles is a prominent driver influencing the demand for automotive engineering services. The key market players are providing OEMs with unique offerings related to lightweight materials, emissions compliance, and electrification. For instance, Capgemini Engineering works with global automobile manufacturers to improve their next-generation vehicle platforms using model-based systems engineering. Likewise, L&T Technology Services has contributed to the development of autonomous driving software and infotainment systems in luxury passenger vehicles. As consumer expectations continue to evolve, automakers are seeking outside expertise to drive the succession of innovation cycles. This dynamic and changing environment continues to expand engineering service providers' influence in the passenger car space.
ADAS and Safety: A Key Segment in Market Growth
The market for automotive engineering services has expanded, and ADAS technology has been developed and used and a result of increased focus on road and vehicle safety laws. Automotive engineering services companies are working with vehicle manufacturers to develop functions, including lane keeping assistance, adaptive cruise control, automated emergency braking, and other functions. For instance, Tech Mahindra has full lifecycle engineering support for sensor fusion algorithms and embedded software development in ADAS systems. In the same way, AVL is providing simulators and validation services to create better performance and safety for driver assistance features.
Regional Outlook
The global automotive engineering services market is further divided by geography, including North America (the US and Canada), Europe (the UK, Germany, France, Italy, Spain, Russia, and the Rest of Europe), Asia-Pacific (India, China, Japan, South Korea, Australia and New Zealand, ASEAN Countries, and the Rest of Asia-Pacific), and the Rest of the World (the Middle East & Africa, and Latin America).
Rising Vehicle Production and Penetration of New Technologies in Asia-Pacific
The Asia-Pacific market continues to grow in automotive engineering services owing to rising vehicle production and penetration of new technologies. Countries including China, India, and South Korea are heavily funding R&D infrastructure that is accelerating a competitive innovation environment. Furthermore, a greater demand for electric vehicles, along with connectivity capabilities, has propelled unique engineering work by OEMs that is driving the development of new digital platforms and embedded systems capabilities. For instance, KPIT Technologies is assisting OEMs in software-defined vehicle engineering with battery management and electric powertrain development directly associated with the transition of mobility capabilities in the Asia-Pacific.
Europe Region Dominates the Market with Major Share
The automotive engineering services in Europe are growing exponentially owing to the high demand for electrification and autonomous vehicle technology systems. Regulatory demands around emissions and safety are driving OEMs to search for more advanced engineering solutions. The region's increasing focus on sustainability and technological innovation has led to a surge in OEM-service business collaborations and investments in digital twin, vehicle simulation, and e-mobility platform technologies to support new vehicle architectures. For instance, Bertrandt AG developed a specialized engineering project for electric and autonomous vehicles; this allows them to help accelerate design efficiencies while being compliant and sustainable.
Market Players Outlook
The major companies operating in the global automotive engineering services market include Alten Group, Bertrandt AG, Continental AG, HARMAN International Industries, Inc., and L&T Technology Services Ltd., among others. Market players are leveraging partnerships, collaborations, mergers and acquisition strategies for business expansion and innovative product development to maintain their market positioning.
Recent Developments
- In June 2025, HCLTech, a global technology corp., announced that Volvo Cars had selected HCLTech as one of its strategic suppliers for engineering services. For many years, Volvo Cars automotive innovation by setting out to shape the future of mobility with strong ambitions on sustainable growth and giving customers the flexibility to relocate in a sustainable, safe, and individual way. HCLTech leverages its established relationship with digital and PLM services for contracts with Volvo Cars. HCLTech's role is significantly expanded by this agreement from offering point services to offering end-to-end engineering solutions on a scale.
- In April 2025, Tata Elxsi announced a strategic multi-year deal of €50 million ($54.1 million) with a European headquartered automotive OEM, jointly with its design and technology services. This strategic deal positions Tata Elxsi as the key variable engineering partner for the escalation of platform and application developments for SDV, electrification, body, and chassis developments. As Tata Elxsi initiates the collaboration on behalf of the OEM, Tata Elxsi subsequently will establish a dedicated Global Engineering Centre to support the OEM's software platform roadmap and associated brand-aligned software engineering programs.
- In January 2024, FPT launched a new department under the theme of Automotive Software Engineering (ASE) to strengthen school education for potential engineers. This is a collaborative implementation between FPT Automotive and FPT University and was developed to respond to the technological advances seen in automobile technology and contribute to producing quality human resources for this rapidly growing field on a global scale. They have the opportunity to develop specialty skills in the area of design, development, and testing of automobile software systems and embedded systems.
- Market value data analysis of 2024 and forecast to 2035.
- Annualized market revenues ($ million) for each market segment.
- Country-wise analysis of major geographical regions.
- Key companies operating in the global automotive engineering services market. Based on the availability of data, information related to new products and relevant news is also available in the report.
- Analysis of business strategies by identifying the key market segments positioned for strong growth in the future.
- Analysis of market-entry and market expansion strategies.
- Competitive strategies by identifying ‘who-stands-where’ in the market.
Table of Contents
210 Pages
- 1. Report Summary
- Current Industry Analysis and Growth Potential Outlook
- Global Automotive Engineering Services Market Sales Analysis – Vehicle Type | Service | Application ($ Million)
- Automotive Engineering Services Market Sales Performance of Top Countries
- 1.1. Research Methodology
- Primary Research Approach
- Secondary Research Approach
- 1.2. Market Snapshot
- 2. Market Overview and Insights
- 2.1. Scope of the Study
- 2.2. Analyst Insight & Current Market Trends
- 2.2.1. Key Automotive Engineering Services Market Trends
- 2.2.2. Market Recommendations
- 2.3. Porter's Five Forces Analysis for the Automotive Engineering Services Market
- 2.3.1. Competitive Rivalry
- 2.3.2. Threat of New Entrants
- 2.3.3. Bargaining Power of Suppliers
- 2.3.4. Bargaining Power of Buyers
- 2.3.5. Threat of Substitutes
- 3. Market Determinants
- 3.1. Market Drivers
- 3.1.1. Drivers For Global Automotive Engineering Services Market: Impact Analysis
- 3.2. Market Pain Points and Challenges
- 3.2.1. Restraints For Global Automotive Engineering Services Market: Impact Analysis
- 3.3. Market Opportunities
- 3.3.1. Opportunities For Global Automotive Engineering Services Market: Impact Analysis
- 4. Competitive Landscape
- 4.1. Competitive Dashboard – Automotive Engineering Services Market Revenue and Share by Manufacturers
- Automotive Engineering Services Product Comparison Analysis
- Top Market Player Ranking Matrix
- 4.2. Key Company Analysis
- 4.2.1. Alten Group
- 4.2.1.1. Overview
- 4.2.1.2. Product Portfolio
- 4.2.1.3. Financial Analysis (Subject to Data Availability)
- 4.2.1.4. SWOT Analysis
- 4.2.1.5. Business Strategy
- 4.2.2. Bertrandt AG
- 4.2.2.1. Overview
- 4.2.2.2. Product Portfolio
- 4.2.2.3. Financial Analysis (Subject to Data Availability)
- 4.2.2.4. SWOT Analysis
- 4.2.2.5. Business Strategy
- 4.2.3. Continental AG
- 4.2.3.1. Overview
- 4.2.3.2. Product Portfolio
- 4.2.3.3. Financial Analysis (Subject to Data Availability)
- 4.2.3.4. SWOT Analysis
- 4.2.3.5. Business Strategy
- 4.2.4. HARMAN International Industries, Inc.
- 4.2.4.1. Overview
- 4.2.4.2. Product Portfolio
- 4.2.4.3. Financial Analysis (Subject to Data Availability)
- 4.2.4.4. SWOT Analysis
- 4.2.4.5. Business Strategy
- 4.2.5. L&T Technology Services Ltd.
- 4.2.5.1. Overview
- 4.2.5.2. Product Portfolio
- 4.2.5.3. Financial Analysis (Subject to Data Availability)
- 4.2.5.4. SWOT Analysis
- 4.2.5.5. Business Strategy
- 4.3. Top Winning Strategies by Market Players
- 4.3.1. Merger and Acquisition
- 4.3.2. Product Launch
- 4.3.3. Partnership And Collaboration
- 5. Global Automotive Engineering Services Market Sales Analysis by Vehicle Type ($ Million)
- 5.1. Passenger Cars
- 5.2. Commercial Vehicle
- 6. Global Automotive Engineering Services Market Sales Analysis by Service ($ Million)
- 6.1. Concept/Research
- 6.2. Designing
- 6.3. Prototyping
- 6.4. System Integration
- 6.5. Testing
- 7. Global Automotive Engineering Services Market Sales Analysis by Application ($ Million)
- 7.1. ADAS and safety
- 7.2. Electrical, electronics, and body controls
- 7.3. Chassis
- 7.4. Connectivity Services
- 7.5. Interior, exterior, and body engineering
- 7.6. Powertrain and exhaust
- 7.7. Simulation
- 7.8. Battery development and management
- 7.9. Charger Testing
- 7.10. Motor controls
- 7.11. Others (Wheel Assembly and Autonomous System)
- 8. Regional Analysis
- 8.1. North American Automotive Engineering Services Market Sales Analysis – Vehicle Type | Service | Application | Country ($ Million)
- Macroeconomic Factors for North America
- 8.1.1. United States
- 8.1.2. Canada
- 8.2. European Automotive Engineering Services Market Sales Analysis – Vehicle Type | Service | Application | Country ($ Million)
- Macroeconomic Factors for Europe
- 8.2.1. UK
- 8.2.2. Germany
- 8.2.3. Italy
- 8.2.4. Spain
- 8.2.5. France
- 8.2.6. Russia
- 8.2.7. Rest of Europe
- 8.3. Asia-Pacific Automotive Engineering Services Market Sales Analysis – Vehicle Type | Service | Application | Country ($ Million)
- Macroeconomic Factors for Asia-Pacific
- 8.3.1. China
- 8.3.2. Japan
- 8.3.3. South Korea
- 8.3.4. India
- 8.3.5. Australia & New Zealand
- 8.3.6. ASEAN Countries (Thailand, Indonesia, Vietnam, Singapore, And Other)
- 8.3.7. Rest of Asia-Pacific
- 8.4. Rest of the World Automotive Engineering Services Market Sales Analysis – Vehicle Type | Service | Application | Country ($ Million)
- Macroeconomic Factors for the Rest of the World
- 8.4.1. Latin America
- 8.4.2. Middle East and Africa
- 9. Company Profiles
- 9.1. Alten Group
- 9.1.1. Quick Facts
- 9.1.2. Company Overview
- 9.1.3. Product Portfolio
- 9.1.4. Business Strategies
- 9.2. Ansys, Inc.
- 9.2.1. Quick Facts
- 9.2.2. Company Overview
- 9.2.3. Product Portfolio
- 9.2.4. Business Strategies
- 9.3. AVL List GmbH
- 9.3.1. Quick Facts
- 9.3.2. Company Overview
- 9.3.3. Product Portfolio
- 9.3.4. Business Strategies
- 9.4. Bertrandt AG
- 9.4.1. Quick Facts
- 9.4.2. Company Overview
- 9.4.3. Product Portfolio
- 9.4.4. Business Strategies
- 9.5. Capgemini Service SAS
- 9.5.1. Quick Facts
- 9.5.2. Company Overview
- 9.5.3. Product Portfolio
- 9.5.4. Business Strategies
- 9.6. Continental AG
- 9.6.1. Quick Facts
- 9.6.2. Company Overview
- 9.6.3. Product Portfolio
- 9.6.4. Business Strategies
- 9.7. Cyient Ltd.
- 9.7.1. Quick Facts
- 9.7.2. Company Overview
- 9.7.3. Product Portfolio
- 9.7.4. Business Strategies
- 9.8. EDAG Engineering GmbH
- 9.8.1. Quick Facts
- 9.8.2. Company Overview
- 9.8.3. Product Portfolio
- 9.8.4. Business Strategies
- 9.9. FEV Group GmbH
- 9.9.1. Quick Facts
- 9.9.2. Company Overview
- 9.9.3. Product Portfolio
- 9.9.4. Business Strategies
- 9.10. HCL Technologies Ltd.
- 9.10.1. Quick Facts
- 9.10.2. Company Overview
- 9.10.3. Product Portfolio
- 9.10.4. Business Strategies
- 9.11. HARMAN International Industries, Inc.
- 9.11.1. Quick Facts
- 9.11.2. Company Overview
- 9.11.3. Product Portfolio
- 9.11.4. Business Strategies
- 9.12. IAV GmbH
- 9.12.1. Quick Facts
- 9.12.2. Company Overview
- 9.12.3. Product Portfolio
- 9.12.4. Business Strategies
- 9.13. KPIT Technologies Ltd.
- 9.13.1. Quick Facts
- 9.13.2. Company Overview
- 9.13.3. Product Portfolio
- 9.13.4. Business Strategies
- 9.14. L&T Technology Services Ltd.
- 9.14.1. Quick Facts
- 9.14.2. Company Overview
- 9.14.3. Product Portfolio
- 9.14.4. Business Strategies
- 9.15. Magna International Inc.
- 9.15.1. Quick Facts
- 9.15.2. Company Overview
- 9.15.3. Product Portfolio
- 9.15.4. Business Strategies
- 9.16. Quest Global Services Pte. Ltd.
- 9.16.1. Quick Facts
- 9.16.2. Company Overview
- 9.16.3. Product Portfolio
- 9.16.4. Business Strategies
- 9.17. Ricardo plc
- 9.17.1. Quick Facts
- 9.17.2. Company Overview
- 9.17.3. Product Portfolio
- 9.17.4. Business Strategies
- 9.18. Robert Bosch GmbH
- 9.18.1. Quick Facts
- 9.18.2. Company Overview
- 9.18.3. Product Portfolio
- 9.18.4. Business Strategies
- 9.19. Rohde & Schwarz USA, Inc.
- 9.19.1. Quick Facts
- 9.19.2. Company Overview
- 9.19.3. Product Portfolio
- 9.19.4. Business Strategies
- 9.20. Siemens AG
- 9.20.1. Quick Facts
- 9.20.2. Company Overview
- 9.20.3. Product Portfolio
- 9.20.4. Business Strategies
- 9.21. Synopsys, Inc.
- 9.21.1. Quick Facts
- 9.21.2. Company Overview
- 9.21.3. Product Portfolio
- 9.21.4. Business Strategies
- 9.22. Tata Elxsi Ltd.
- 9.22.1. Quick Facts
- 9.22.2. Company Overview
- 9.22.3. Product Portfolio
- 9.22.4. Business Strategies
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