Engineering Services Market

Market Definition

Engineering services comprise specialized technical activities that apply scientific and engineering principles to the design, development, and optimization of systems, structures, and processes across various industries. These services are primarily used to support projects in sectors such as construction, manufacturing, energy, transportation, and technology by ensuring safety, efficiency, regulatory compliance, and overall project success.

Engineering Services Market Overview

The global engineering services market size was valued at USD 1,432.20 billion in 2024 and is projected to grow from USD 1,517.68 billion in 2025 to USD 2,405.91 billion by 2032, exhibiting a CAGR of 6.80% during the forecast period. 

This market is experiencing sustained growth due to the rising demand across industries such as automotive, aerospace, construction, energy, and information technology. This growth is further supported by advancements in digital engineering, automation, and artificial intelligence, which are enhancing design precision, operational efficiency, and project management capabilities.

Major companies operating in the engineering services industry are LARSEN & TOUBRO LIMITED, AECOM, Siemens, ABB, TATA Consultancy Services Limited, Arup, Bechtel Corporation, Bharat Heavy Electricals Limited, CSCEC ICP, Fluor Corporation, HCL Technologies Limited, Hitachi Energy Ltd, Capgemini, KONE Elevator India Private Limited, and Cognizant.

Global industrialization, particularly in emerging economies, is driving the need for large-scale infrastructure projects and complex engineering solutions. Moreover, increasing investments by governments and private enterprises in smart manufacturing facilities, renewable energy infrastructure, and sustainable urban development are further accelerating market growth. 

Technological innovations in areas such as artificial intelligence, digital twin technology, Internet of Things (IoT), and automation are transforming engineering workflows, enabling faster, more efficient, and cost-effective project execution. 

• In August 2024, HCLTech extended its partnership with Xerox to advance AI-driven engineering and digital operations under Xerox’s “Reinvention” strategy. The collaboration uses HCLTech’s GenAI platform, AI Force, to streamline business processes, enhance customer experience, and improve sales, supply chain, and service operations.

Key Highlights

1. The engineering services industry size was valued at USD 1,432.20 billion in 2024.
2. The market is projected to grow at a CAGR of 6.80% from 2025 to 2032.
3. North America held a market share of 36.77% in 2024, with a valuation of USD 526.62 billion.
4. The civil segment garnered USD 401.02 billion in revenue in 2024.
5. The product engineering segment is expected to reach USD 833.24 billion by 2032.
6. The offshore segment is anticipated to witness the fastest CAGR of 6.99% over the forecast period.
7. The automotive & mobility segment garnered USD 401.02 billion in revenue in 2024.
8. Asia Pacific is anticipated to grow at a CAGR of 7.11% through the projection period.

Market Driver

Rising Adoption of Outsourced Engineering Services

The growth of outsourced engineering services is fueled by the increasing need for cost efficiency, access to specialized skills, and enhanced operational scalability across industries. As companies face rising pressure to accelerate innovation and manage complex product lifecycles, outsourcing offers a strategic advantage by enabling faster project execution without expanding in-house teams.

This shift is especially evident in sectors such as automotive, aerospace, and industrial equipment, where multidisciplinary expertise and digital capabilities are essential. Engineering service providers are delivering tailored, end-to-end solutions by integrating advanced technologies, global delivery models, and domain-specific knowledge.

As outsourcing becomes integral to engineering strategies, it is reshaping delivery models and driving long-term partnerships, thereby accelerating market expansion and transforming the development and delivery of engineering solutions.

• In March 2024, Tata Consultancy Services (TCS) entered a seven-year agreement with Denmark-based engineering firm Ramboll to transform its global IT infrastructure. The collaboration focuses on modernizing cloud operations, application development, cybersecurity, and digital workplace services, aiming to improve scalability, operational efficiency, and cost management.

Market Challenge

Data Security and Intellectual Property Concerns

The engineering services market faces significant challenges related to data security and intellectual property (IP) protection as companies increasingly rely on digital platforms and global collaboration. 

The exchange of sensitive designs, proprietary technologies, and confidential client information across geographies heightens the risk of cyberattacks, data breaches, and IP theft. Complex partnerships with external vendors and offshore teams make data governance and compliance with regional regulations more difficult.

To address these risks, organizations are adopting robust cybersecurity frameworks, advanced encryption, and strict contractual safeguards to protect proprietary information while ensuring efficient global operations. Additionally, regular security audits, employee training, and real-time threat monitoring are being implemented to strengthen protection efforts.

Market Trend

Expansion of AI-Powered Autonomous Engineering

A significant trend in the engineering services market is the emerging adoption of AI-powered autonomous engineering systems that enhance design precision, operational efficiency, and development speed. These advanced systems utilize artificial intelligence to automate complex tasks such as generative design, real-time simulation, predictive analytics, and continuous optimization throughout the engineering lifecycle. 

By minimizing manual intervention and accelerating iterative design processes, autonomous engineering reduces development timelines, lowers costs, and improves product performance.

These systems enable continuous learning and real-time adjustments based on operational data, allowing for proactive issue resolution and ongoing performance enhancement even after deployment. Integration with digital twin technology and advanced simulation platforms further strengthens decision-making accuracy and system reliability. 

As AI technologies mature and become more accessible, industries such as aerospace, automotive, energy, and smart infrastructure are expected to increasingly adopt autonomous engineering solutions, driving significant market growth and transformation.

• In October 2024, Capgemini launched its “Augmented Engineering” offerings, combining generative AI with scientific modeling to accelerate R&D, software development, customer support, and technical documentation. The solutions aim to boost innovation speed, efficiency, and compliance across industries like pharmaceuticals, aerospace, and manufacturing.

Engineering Services Market Report Snapshot

Segmentation	Details
By Engineering Discipline	Civil, Mechanical, Electrical, Piping & Structural, Environmental, and Others
By Service Type	Product Engineering, Process Engineering, Automation Services, Asset Management, and Others
By Delivery Model	Onshore, and Offshore
By End-user Industry	Automotive & Mobility, Healthcare & Life Sciences, Manufacturing & Mining, BFSI, Retail & Consumer Goods, and Aerospace & Defense
By Region	North America: U.S., Canada, Mexico
	Europe: France, UK, Spain, Germany, Italy, Russia, Rest of Europe
	Asia-Pacific: China, Japan, India, Australia, ASEAN, South Korea, Rest of Asia-Pacific
	Middle East & Africa: Turkey, U.A.E., Saudi Arabia, South Africa, Rest of Middle East & Africa
	South America: Brazil, Argentina, Rest of South America

Market Segmentation

• By Engineering Discipline (Civil, Mechanical, Electrical, Piping & Structural, Environmental, and Others): The civil segment earned USD 401.02 billion in 2024 due to growing investments in infrastructure development, urbanization, and large-scale construction projects globally.
• By Service Type (Product Engineering, Process Engineering, Automation Services, Asset Management, and Others): The product engineering segment held a share of 35.00% in 2024, attributed to the increasing demand for innovative product designs, faster time-to-market, and rising complexity in product development across industries.
• By Delivery Model (Onshore, and Offshore): The onshore segment is projected to reach USD 1,420.58 billion by 2032, owing to growing preference for close client collaboration, regulatory compliance requirements, and the need for greater control over project execution and data security.
• By End-user Industry (Automotive & Mobility, Healthcare & Life Sciences, Manufacturing & Mining, BFSI, Retail & Consumer Goods, and Aerospace & Defense): The automotive & mobility segment is anticipated to grow at a CAGR of 8.12% through the projection period due to rapid advancements in electric vehicles, autonomous driving technologies, and increasing demand for smart mobility solutions.

Engineering Services Market Regional Analysis

Based on region, the market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and South America.

North America engineering services market share stood at 36.77% in 2024, valued at USD 526.62 billion. North America is witnessing robust advancements in engineering services, supported by continuous technological innovation and strong industrial demand. The region’s mature aerospace, defense, automotive, and IT sectors are generating steady requirements for sophisticated design, simulation, and automation solutions.

Leading service providers are actively adopting digital twin technology, AI-driven analytics, and cloud-based engineering platforms to enhance efficiency and reduce development cycles. 

Moreover, North America is experiencing increasing collaboration between research institutions, engineering firms and technology providers such as cloud platform companies and digital solution developers to advance innovation in autonomous systems, renewable energy infrastructure, and smart city initiatives.  These factors are driving the market across the North America region.

The Asia-Pacific engineering services industry is set to grow at a CAGR of 7.11% over the forecast period. This growth is attributed to rapid industrial expansion, increasing infrastructure development, and growing demand for advanced manufacturing capabilities across emerging economies.

The rise in large-scale transportation, energy, and construction projects, combined with favorable government policies supporting industrial modernization is fueling demand for specialized engineering services.

Furthermore, rising foreign direct investment, the development of specialized technology parks, and the emergence of regional innovation hubs such as advanced research centers and industrial accelerators are encouraging global engineering firms to establish local delivery centers. These hubs foster collaboration, incubate new technologies, and streamline access to skilled talent. 

Strengthening partnerships among multinational corporations, regional service providers, and academic institutions is also driving workforce development and facilitating technology transfer, thereby enhancing the region’s engineering service capabilities and competitiveness.

• In February 2025, H&MV Engineering expanded its global operations with a new office in Bangalore, India. This new center is expected to enhance the company’s high-voltage design, engineering, and construction expertise for international projects.

Regulatory Frameworks

• In the U.S., the Export Administration Regulations (EAR) regulate the export of engineering services, technical data, and controlled technologies. It ensures that sensitive engineering work, particularly in defense, aerospace, and high-tech industries, complies with national security and foreign policy objectives.
• In the European Union, the General Data Protection Regulation (GDPR) governs the collection, storage, and processing of personal data in engineering projects, especially when services involve digital platforms, data analytics, and software engineering. It ensures privacy protection across cross-border engineering services.
• Globally, ISO/IEC 27001 governs information security management systems, ensuring secure handling of proprietary engineering data, intellectual property, and client information. This standard is widely adopted in global engineering services outsourcing and digital engineering engagements.

Competitive Landscape

The global engineering services industry is characterized by a diverse mix of well-established multinational corporations and specialized service providers. Market players are focusing on expanding their service portfolios and global reach through technological innovation, service diversification, and strategic partnerships.

Companies are heavily investing in digital engineering capabilities, including artificial intelligence, digital twin technology, automation, and cloud-based platforms, to enhance service efficiency, reduce costs, and address increasing client demands for complex, high-precision solutions.

• In October 2024, ITJ USA, Inc. launched its software engineering services for the life sciences and biotech sectors on AWS Marketplace. The offering allows companies to scale engineering teams, accelerate R&D, and ensure compliance by combining AWS infrastructure with ITJ’s AI expertise and nearshore talent model.

Market players are offering customized engineering solutions tailored to sector-specific needs in aerospace, automotive, energy, and infrastructure. These services address rising project complexity and regulatory requirements. Additionally, companies are strengthening their technical capabilities through partnerships with technology providers, research institutions, and academic organizations to enhance service innovation and domain expertise.

List of Key Companies in Engineering Services Market:

• LARSEN & TOUBRO LIMITED
• AECOM
• Siemens
• ABB
• TATA Consultancy Services Limited
• Arup
• Bechtel Corporation
• Bharat Heavy Electricals Limited
• CSCEC ICP
• Fluor Corporation
• HCL Technologies Limited
• Hitachi Energy Ltd
• Capgemini
• KONE Elevator India Private Limited
• Cognizant

Recent Developments (M&A/Partnerships/Agreements)

• In February 2025, Align Capital Partners recapitalized AKS Engineering, a Canada-based consulting firm specializing in civil engineering, surveying, and design services. The investment aims to support AKS’s growth by enabling strategic geographic expansion and enhancing operational capabilities. 
• In June 2024, Cognizant and Gentherm signed a strategic partnership for product engineering services, including systems engineering, validation, and model-based development to advance Gentherm’s thermal management and comfort solutions. A new test and delivery center in Hyderabad, India, will support R&D and accelerate software-defined vehicle innovation using Cognizant's AI, cloud, and virtualization expertise.
• In May 2024, HCL Technologies Limited signed an agreement to acquire select assets of Hewlett Packard Enterprise’s Communications Technology Group, including intellectual property, engineering talent, and customer relationships with major telecom carriers. This is expected to enhance HCLTech’s telecom engineering capabilities across business support systems, network applications, cloud services, and data analytics.
• In April 2024, Infosys acquired in-tech, a German engineering R&D services firm specializing in automotive, rail, and industrial sectors for USD 480 million. The acquisition is expected to strengthen Infosys’s capabilities in e-mobility, autonomous vehicles, and software-defined mobility, and accelerate innovation in software-driven automotive solutions.
• In December 2023, L&T Technology Services (LTTS) entered a multi-year engineering services partnership with BP plc. to support its global operations. The partnership includes services such as project engineering, maintenance optimization, technical documentation, engineering data management, and sustainability-focused initiatives.