AUTOMOTIVE ENGINEERING SERVICES MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

Automotive Engineering Services Market Size and Trends

Global Automotive Engineering Services Market is estimated to be valued at USD 270.21 Bn in 2024 and is expected to reach USD 450.44 Bn by 2031, growing at a compound annual growth rate (CAGR) of 7.6% from 2024 to 2031.

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Automotive engineering services help automotive manufacturers and suppliers in developing and testing new vehicle models before production. These services play a crucial role in improving vehicle design, reducing costs and bringing innovative products to market. The industry is poised to witness a significant growth in the coming years owing to factors such as rise in vehicle production and sales globally, stringent emission and safety regulations, increasing consumer demand for fuel-efficient and high-performance vehicles and developments in autonomous and electric vehicle technologies. Moreover, the increasing adoption of advanced technologies such as VR/AR, 3D printing, AI and IoT by automotive OEMs and suppliers is also expected to drive the demand for automotive engineering services. However, high investment costs associated with automotive R&D activities may hamper market growth to some extent over the next few years.

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Top Strategies Followed by Automotive Engineering Services Market Players

• Established Players: Established Players focus heavily on research and development to innovate new products. Major companies like Bosch, Continental, and Denso invest over 5% of their annual revenues in R&D. They partner with automakers and each other to develop key technologies like electric powertrains, autonomous driving systems, and vehicle connectivity solutions. These alliances help them gain critical insights into future mobility trends and solidify their position with OEMs.
• Mid-level Players: Mid-level players stand out by delivering high-quality yet affordable solutions. Companies like P3 Group focus on cost-effective engineering services and independent testing. They form partnerships with smaller firms to strengthen capabilities in newer areas like ADAS and battery technologies. Such collaborations help expand service portfolios and target price-sensitive automakers.
• Small Players: Small players find success through niche specialization. For instance, AVL excels in electric powertrain engineering and holds multiple patents. Lambda Engineering focuses on prototyping and testing for electric vehicles and advanced driver assistance systems. They leverage modern technologies and local partnerships to establish themselves and gain clients.

Emerging Startups in the Automotive Engineering Services Market

• Innovation- Several startups are developing innovative technologies impacting the industry. For example, Anthropic develops AI safety solutions to enable safe autonomous driving. Oxrs develops smart sensor technologies for advanced driver monitoring systems. Their technologies could transform critical vehicle systems and help achieve fully autonomous vehicles sooner.
• Sustainability- Sustainability-focused startups also contribute importantly. Valencell develops biometric sensors enabling precisely tuned active safety and emissions control. This helps reduce environmental impact. Recolte collects and recycles lithium-ion batteries from EVs securely and provides battery-as-a-service. Their contributions advance the circular economy goals of automakers.
• Collaborations- Many startups fill unique market needs through collaborations. For instance, Otonomo partners with major automakers and municipalities to apply its open platform for car data applications. This boosts data and software-based services surrounding connectivity. Verkor works with automakers, suppliers, and industrial groups to build sustainable and affordable battery gigafactories in Europe.