Product Engineering Services Market Size, Share and Trends 2024 to 2034

Product Engineering Services Market Size and Forecast 2024 to 2034

The global product engineering services market size is worth around USD 1.29 trillion in 2024 and is anticipated to reach around USD 2.59 trillion by 2034, growing at a CAGR of 7.24% from 2024 to 2034. The rising digitization and adaptation of automation in industries are driving the growth of the product engineering services market.

Product Engineering Services Market Key Takeaways

• North America dominated the global market with the largest market share of 51% in 2023.
• Asia Pacific is expected to witness significant growth during the forecast period.
• By service, the development segment contributed the highest market share in 2023.
• By service, the deployment segment will show significant growth during the forecast period.
• By enterprise, the large enterprise segment led the market in 2023. 
• By enterprise, the small and medium enterprise segment will witness significant growth during the forecast period.
• By industry, the manufacturing segment accounted for the highest market share in 2023.
• By industry, the healthcare and life science segment is anticipated to show significant growth from 2024 to 2034.

How Can AI Impact the Product Engineering Services Market?

The integration of artificial intelligence in the product engineering services market helps revolutionize the industrial process by streamlining the product development cycle. AI-powered automation maintains and streamlines repetitive tasks, minimizes the time to market, and increases overall efficiency. AI accelerates product development cycles, product quality and performance, and personalizes user experience.

• In October 2024, Capgemini launched engineering and R&D-specific Generative AI (Gen AI) infused solutions for consumers to streamline engineering, innovation, and R&D processes with high-level automation and new innovations.

U.S. Product Engineering Services Market Size and Growth 2024 to 2034

The U.S. product engineering services market size is evaluated at USD 460 million in 2024 and is projected to be worth around USD 940 million by 2034, growing at a CAGR of 7.37% from 2024 to 2034.

North America dominated the product engineering services market in 2023. The growth of the market is attributed to the rising industrialization, such as the growth in the industries including healthcare, automotive, BFSI, telecommunication, IT, aerospace and defense, retail, and others are driving the demand for the product engineering services for the development of the different types of products and services in the organization from start to the finished product deployment to the consumers or users. Furthermore, there is an ongoing investment in research and further technological development.

• In the United States, there are 84.7% of the surveyed companies specializing in developing Enterprise Applications for clients. 53% of the participant's organizations take on software projects on business process automation. 15.4% of organizations provide customer relationship management software solutions.
• Marketing software is the top priority factor in terms of investment, with 28% second to IT security (32%) for all the consumers of software worldwide in 2024.

Asia Pacific is expected to witness significant growth in the product engineering services market during the forecast period. The growth of the market is attributed to the continuously growing population, which causes the increased demand for industrial development, and the rising spending on technological advancements in the industrial process is driving the growth of product engineering services across the region.

• The IT and BPM industry is one of the emerging sectors in the Indian economy, significantly contributing to the country's GDP and public welfare. The IT industry accounted for about 7.5% of India’s GDP in FY23 and is anticipated to contribute 10% to India’s GDP by 2025.
• India's IT industry revenue touched USD 227 billion in FY22, and the 15.5% YoY growth is estimated to touch USD 245 billion in FY23. The software industry in India is expected to record a notable growth of 11.1% in 2024.

Market Overview

The product engineering services involve the development of the service or the platform using the hardware design, industrial design, and embedded software techniques. The product engineering services offer different programming tools and devices, microprocessors, interfaces, memory devices, operating systems, and UI tools to develop and engineer a product. There are a number of product engineering services that serve in medical devices, wearable goods, aerospace and military, automotive electronics, industrial products, and several other industries.

Product Engineering Services Market Growth Factors

• Increasing industrialization: The rising industrialization across the world and the association of technologies in the industries for improving the efficiency in product and service development is driving the growth of the market.
• Modernization in technology: Product engineering plays a significant role in the modernization of industrial technology; there are several leading technology firms offering advanced technological solutions that provide benefits in operations in a wide range of industries.
• The Investment in technologies: The rising investment in technological advancement in companies and the rising digital transformation across countries are driving the demand for the product engineering services market.

Market Scope

Market Dynamics

Driver

Product engineering services advantages

The increasing spending on technologies and digitization across industries and personal businesses are driving the growth of the product engineering services market. Product engineering offers several benefits to the wider application in industries such as software testing, prototyping, ideation, product modernization, product design, product engineering, business process reengineering, new product development, architecture design, hardware integration, quality engineering, maintenance, turnkey product development, software development, migration, improving performance, and others.

Restraint

Data issues

The data privacy issue, such as concerns related to the protection of data, is the major restraining the growth of the product engineering services market.

Opportunity

Rising IT and telecom industry

The rising investment in the evaluation of the IT (information technology) and telecom (telecommunication) industries is emerging as a potential opportunity for the product engineering services market expansion. Product engineering enhanced product development, software testing, product support, product modernization, prototype development, product engineering, product lifecycle management, quality engineering, software engineering, technology assessment, embedded engineering, and other applications in the field.

Service Insights

The development segment dominated the product engineering services market in 2023. The increasing demand for product engineering in the industries for the overall development of all the stages of product development collide with the user requirements and organization goals. The rising demand for product development in different industries and services and the rising digitization across industries are driving the demand for product development in the product development segment.

The deployment segment will show significant growth in the product engineering services market during the forecast period. Product deployment is also known as the release or launch of the software to the users. The deployment of the software is done via different distribution channels, including app stores, cloud platforms, and internal distribution channels. Continuous Deployment and Continuous Integration pipelines allow efficient deployment of software with minimum disruption and downtime.

Enterprise Insights

The large enterprise segment led the product engineering services market in 2023. The increasing demand for the product engineering in the large enterprises or organizations for increasing the efficiency of the product development cycles and services. Product engineering helps large enterprises across a wide range of applications from start to end product development.

The small & medium enterprise segment will witness significant growth in the product engineering services market during the forecast period. The increasing industrialization across the world, the ongoing investment in the development of small and medium enterprises, and the increasing digital transformation are driving the demand for product engineering services for the development of different software products and services.

Industry Insights

The manufacturing segment accounted for the highest share of the product engineering services market in 2023. The rising population causes higher demand for the manufacturing sector, and the demand for product and service development and management in the manufacturing sector is driving the demand for product engineering services. Product engineering helps improve product quality, enhance productivity and cost savings, enhance customer satisfaction, increase innovations with new product development, and more.

The healthcare & life science segment is anticipated to show significant growth in the product engineering services market during the forecast period. The integration of product engineering is revolutionizing the overall healthcare and life science industry. Product engineering in the healthcare sector helps in the designing, testing, development, and deployment of software. Product engineering helps improve patient monitoring, increase the safety and security of patients, provide remote healthcare assistance, improve health management, and enhance accuracy.

Product Engineering Services Market Companies

• Oracle. (U.S.)
• Accenture (Ireland)
• Infosys Limited (India)
• GEP (U.S.)
• Genpact (U.S.)
• Proxima (U.K.)
• IBM (U.S.)
• Broadcom (U.S.)
• WNS (Holdings) Ltd. (India)
• Capgemini (France)
• Wipro Limited (India)
• HCL Technologies Limited (India)
• Tata Consultancy Services Limited. (India)
• DXC Technology Company (U.K.)
• AEGIS Company. (India)
• Corbus, LLC. (India)
• Aquanima S.A. (Spain)

Latest Announcement by Industry Leaders 

• In October 2024, Oracle launched the latest  AI-powered capabilities within Oracle Fusion Cloud Field Service and Oracle Fusion Cloud Service, which are designed to help the service teams enhance productivity, serving customers with a better understanding of customer issues. The update will automatically detect customer issues and recommendations for actions, streamline resolution, and improve first-time fix rates.
• In December 2024, Accenture announced its intentions to acquire AOX, a leading company that specializes in embedded software for carmakers and their suppliers based in Germany. The equation helps in elevating the consumer experience by helping automotive clients solve challenges in their transition to software-defined vehicles.

Recent Developments

• In July 2024, L&T Technology Services Limited, a leading firm in the global digital engineering and R&D company,  launched the third annual Digital Engineering Awards in association with global technology research and advisory firm Information Services Group (ISG) and business news channel CNBC TV18 in India.
• In November 2024, Suzuki Motor Corporation, a Japanese multinational mobility manufacturer and the global leader in the design and technology services ‘Of Tata Elxsi’ launched the ‘SUZUKI-TATA ELXSI Offshore Development Center’ in Pune, India. The center is especially dedicated to Suzuki’s innovations in advanced engineering and revolutionizing the future.
• In June 2024, Cognizant comes into the agreement for providing engineering services to Gentherm, a leading player in innovative thermal management and pneumatic comfort technologies in the automotive industry and a leading player in medical patient temperature management systems. The Cognizant provided system engineering, model-based development services, and validation from Hyderabad, India, and established the test facility to conduct research and development for Gentherm products.

Segments Covered in the Report 

By Service

• Design 
• Development
• Deployment
• Testing
• Support and Maintenance
• Redesigning and Re-Engineering
• Others (Strategy, Research, and Consulting)

By Enterprise

• Large Enterprises
• Small and Medium Enterprises (SMEs)

By Industry

• Automotive
• Aerospace and Defense
• Healthcare
• BFSI
• IT
• Industrial Manufacturing
• Energy and Utilities
• Telecom
• Others

By Geography

• North America
• Asia Pacific
• Europe
• Latin America
• Middle East and Africa