Global Engineering Services Outsourcing Market Size, Share, Growth Analysis, By Service(Designing, Prototyping), By Location Type(Onshore, Offshore), By Industry Vertical(Aerospace, Automotive) - Industry Forecast 2022-2028

Engineering Services Outsourcing Market was valued at USD 1.30 trillion in 2021, and the market size is estimated to reach USD 6.06 trillion by 2028, at a CAGR of 24.60% over the forecast period (2022-2028).

Engineering services outsourcing (ESO) is the practise of contracting with outside service providers for engineering-related tasks. It entails giving outside engineering companies control over the process of designing, creating, testing, and maintaining goods or systems. The necessity for specialised skills, the emergence of new technologies, and the rising demand for affordable engineering services are all contributing to the rapid growth of the global ESO market.

Top-down and bottom-up approaches were used to estimate and validate the size of the Global Engineering Services Outsourcing Market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined by using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

Segments covered in this report

The global engineering services outsourcing market is segmented based on service, location, industry vertical and region. Based on the service, the engineering services outsourcing market is segmented as designing, prototyping, system integration, testing. Based on location, the engineering services outsourcing market is segmented as onshore and offshore. Based on industry vertical, the engineering services outsourcing market is segmented as aerospace, automotive, construction, consumer electronics, semiconductor, others. Based on region, the engineering services outsourcing market is categorized into North America, Europe, Asia-Pacific, and MEA.

Driver

One of the driving forces for ESO is cost savings. Engineering services can help businesses reduce their operational costs significantly. Because labour prices in developing nations are so much lower than in industrialised ones, outsourcing has become a common choice for companies. Businesses can access a pool of highly qualified personnel they might not otherwise have by outsourcing engineering services. It enables companies to benefit from the expertise of engineering firms and receive access to particular skills and knowledge, such as new product design, prototyping, testing, and certification. By outsourcing engineering services, businesses can concentrate on their key competencies, such as marketing, sales, and customer service, while leaving the engineering work to specialised organisations.

Restraint

The outsourcing of engineering services can pose a risk to data security, particularly when outsourcing to offshore firms. Companies must ensure that their intellectual property and sensitive data are protected. Communication barriers and cultural differences can pose a challenge when outsourcing engineering services. It is important to have effective communication channels and protocols in place to ensure that the outsourcing process runs smoothly.

Market Trends

The rise of digital technologies, such as IoT, AI, and machine learning, is driving the demand for engineering services. Engineering service providers are increasingly focusing on digital transformation to provide innovative solutions and improve their offerings. There is growing demand for sustainable engineering solutions, such as renewable energy, green buildings, and sustainable transportation. Engineering service providers are incorporating sustainability into their offerings to meet the changing needs of customers. The globalization of the engineering services market is leading to increased competition and innovation. Companies are increasingly outsourcing engineering services to offshore firms to gain access to specialized skills and cost-effective solutions. Engineering service providers are increasingly collaborating with each other and with customers to provide integrated solutions. Collaborative partnerships can help companies to leverage the expertise of multiple providers and improve the quality of the work.