PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1771774
PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1771774
The product engineering services market is expanding rapidly, with a projected market size rising from USD 1,297.71 billion in 2025 to USD 1,800.45 billion by 2030, at a CAGR of 6.8% during the forecast period. The key market drivers include the rapid growth of the automotive sector, which boosts demand for advanced product development and engineering capabilities. Another major driver is the increasing need to accelerate time-to-market, as companies seek to stay competitive in fast-paced industries by launching products more quickly. Additionally, there is a growing focus on product design to enhance customer experience, pushing organizations to invest in high-quality engineering services. In contrast, toolchain bloat and DevOps sprawl are the market's major restraints. These challenges reduce team efficiency by creating complex, overlapping workflows and increasing the time and effort required for integration and maintenance.
Scope of the Report | |
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Years Considered for the Study | 2020-2030 |
Base Year | 2024 |
Forecast Period | 2025-2030 |
Units Considered | USD Billion |
Segments | Service Type, Delivery Mode, Organization Size, Vertical |
Regions covered | North America, Europe, Asia Pacific, Middle East & Africa, Latin America |
"Small & medium enterprises are expected to grow at the highest CAGR during the forecast period"
Small & medium enterprises are set to drive the fastest market growth, propelled by their focus on speed, innovation, and cost-efficiency. In March 2025, American Express reported that SMEs adopting artificial intelligence are 38 percent more likely to invest in technology upgrades and new product launches. A June 2024 Zoho survey found that 81 percent of MSMEs in India allocate up to half their tech budgets to cloud solutions, reflecting a global shift toward cloud engineering and IoT-based development.
This creates a strong demand for embedded systems, rapid prototyping, and AI-integrated firmware services. By partnering with engineering service providers, SMEs gain access to specialized skills, reduce development cycles, and scale efficiently without heavy internal investment. As competition intensifies, outsourcing complex engineering tasks allows SMEs to stay agile and innovative. This opens lucrative opportunities for service providers to deliver modular, cloud-ready engineering solutions to a rapidly growing market segment.
"Industrial manufacturing is expected to hold the largest market share during the forecast period"
The industrial manufacturing sector is gaining sustained investment in digital transformation, automation, and next-generation product development. In March 2025, Johnson & Johnson announced a USD 55 billion investment strategy to advance its pharmaceutical and medical device manufacturing capabilities through digitalization, smart factory initiatives, and automation. Meanwhile, Taiwan Semiconductor Manufacturing Company committed USD 100 billion to expand its US-based fabrication and engineering operations to boost domestic chip production capacity, accelerate time-to-market for advanced semiconductors, and enhance supply chain resilience. At CES 2025, Siemens unveiled advanced digital twin and industrial artificial intelligence technologies to improve production efficiency.
These developments increase demand for embedded systems, system integration, and simulation-led engineering services. As manufacturers modernize legacy systems and scale operations, they rely on engineering partners for faster innovation, technical expertise, and operational agility. This growth presents strong opportunities for service providers to support industrial clients in reducing time-to-market, improving product reliability, and long-term competitiveness.
"North America holds the largest market share, while Asia Pacific records the fastest growth"
North America leads the product engineering services market, supported by its premier engineering infrastructure, innovation ecosystems, and significant investments in advanced product development. In June 2025, BASF opened a new Good Manufacturing Practice Solution Center in Michigan to enhance product development in biopharma, demonstrating how engineering services integrate manufacturing with lab-level design capabilities. Meanwhile, Asia Pacific is the fastest-growing region, driven by digital innovation, rising smart product demand, government-backed support for local engineering ecosystems, manufacturing hubs, and talent development across emerging economies.
Breakdown of Primaries
In-depth interviews were conducted with Chief Executive Officers (CEOs), innovation and technology directors, system integrators, and executives from various key organizations operating in the product engineering services market.
The report profiles key players offering product engineering services. These include IBM (US), HCL Tech (India), Cognizant (US), Capgemini (France), Alten Group (France), Accenture (Ireland), Wipro (India), LTIMindtree (India), AVL (Austria), Happiest Minds (India), TVSnext (US), Mphasis (India), Tech Mahindra (India), Cybage Software (India), Innominds (US), Infosys (India), SynergyTop (US), EPAM Systems (US), Brillio (US), GlobalLogic (US), Tata Consultancy Services (India), Nous Infosystems (India), Trigent Software (US), and Aspire Systems (India).
Study Coverage
This research report categorizes the product engineering services market based on Service Type (Product Design & Prototyping [Concept & Ideation, UX/UI & Industrial Design, Others {MBSE, Design for Manufacturability (DFM)/Design for Testability (DFT)}], Product Development [Software Product Development, Hardware & Embedded Systems Development, Prototyping & MVP Development, Integration & Interface Development], Testing & Quality Assurance Services [Functional & Non-functional Testing, Test Automation, Compliance & Certification, Validation & Verification (V&V)], Product Modernization & Integration [Legacy System Migration, Platform Re-platforming, Architectural Overhaul, Technical Debt Reduction], Process Engineering [Manufacturing Engineering Support, Knowledge-based Engineering), Maintenance, Repair & Operations], Reverse Engineering [3D Scanning, Application Modernization & Migration, Others], Product Sustenance & Support Services [Bug Fixing & Maintenance, Performance Optimization & Monitoring, Feature Enhancements & Upgrades, Security Updates & Compliance, DevOps & MLOps Support]), Delivery Mode (Onshore, Offshore, Nearshore, Hybrid), Organization Size (Large Enterprises, SMES), Vertical (Industrial Manufacturing, Automotive & Transportation, Healthcare & Life Sciences, Aerospace & Defense, Semiconductors & Electronics, IT & Telecom, Banking, Financial Services, & Insurances (BFSI), Retail & Ecommerce, Energy & Utilities, Other Verticals), and Region (North America, Europe, Asia Pacific, Middle East & Africa, and Latin America). The report's scope covers detailed information regarding the major factors, such as drivers, restraints, challenges, and opportunities, influencing the growth of the product engineering services market. A thorough analysis of the key industry players provided insights into their business overview, solutions, and services; key strategies; contracts, partnerships, agreements, new product & service launches, mergers and acquisitions; and recent product engineering services market developments. This report also covered the competitive analysis of upcoming startups in the product engineering services market ecosystem.
Benefits of Buying this Report
The report would provide market leaders/new entrants with information on the closest approximations of the revenue numbers for the overall product engineering services market and its subsegments. It would help stakeholders understand the competitive landscape and gain more insights to better position their businesses and plan suitable go-to-market strategies. It also helps stakeholders understand the market's pulse and provides information on key market drivers, restraints, challenges, and opportunities.
The report also helps stakeholders understand the pulse of the product engineering services market and provides them with information on key market drivers, restraints, challenges, and opportunities.