Computer Aided Engineering Market Size, Share, and Trend Analysis By Component (Software, Services), By Deployment Model (On-premise, Cloud-base), By End-use (Automotive, Defense & aerospace), By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global Computer Aided Engineering (CAE) market size was valued at USD 9,163.3 million in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 12.6% from 2023 to 2030, owing to the increased outsourcing of manufacturing processes to emerging economies such as China, India, and Russia, among others. The computer aided engineering (CAE) market is poised for unprecedented growth during the forecast period, as integrated software solutions eliminate the need for multiple prototypes and product recall concerns. As a result, the cost associated with prototyping and product recall strategy is highly reduced. Moreover, the increasing use of CFD software for analyzing temperature in battery modules and extending battery life & performance is anticipated to drive the market growth. 

The market all over the globe is witnessing a drastic shift from on-premise computing to cloud-based computing. Cloud computing reduces costs related to hardware acquisition and software licensing, installation, and support. This is further expected to increase the use of the CAE software. Additionally, companies are adopting the Hyper-Converged Infrastructure (HCI) platform for building a private cloud that enables advanced computation and storage services.

Customers are increasingly quantifying their software contributions. As a result, companies are willing to pay high license fees for the software that supports low-value processes. They are developing alternating pricing and delivering models, alike Software as a Service (SaaS) pricing models, enabling customers to opt for a pay-as-you-go subscription plan. However, the new pricing model is expected to affect the software providers’ cash flow, revenue recognition, and finance.

The market for value added resellers (VAR) is expected to have significant growth over the projected period. VARs will help in reducing the gap between the end-users and suppliers. VARs receive certifications and training from suppliers to increase their credibility. As a result, the growth of VARs is expected to have a positive effect on the growth of the computer aided engineering market over the forecast period.

The outbreak of the COVID-19 pandemic has resulted in higher demand for Personal Protective Equipment (PPE) kits, ventilators & respirators, and face shield holders. This has led several companies to leverage Additive Manufacturing Technology, CFD analysis, and CAD model with a 3D printing platform to develop and supply this lifesaving equipment. The use of CAE combined with proper knowledge can help bring in rapid and practical solutions to elucidate real-life issues quickly and efficiently.

Component Insights

Based on component, the market is segmented into software and services. The software segment accounted the major market share in 2022 and is anticipated to continue its dominance in the coming years. The segment growth can be attributed to benefits such as data safety, reliability, and uninterrupted testing. The software optimizes the engineering tasks and are majorly used to examine the robustness and performance of the components and assemblies.

Based on software types, the industry is segmented into Finite Element Analysis (FEA), Computational Fluid Dynamics (CFD), multibody dynamics, and optimization & simulation. In 2022, the FEA segment accounted for a market share of more than 51% and is anticipated to dominate the market over the forecast. FEA is a computational analysis methodology that helps in determining the strength of a product with respect to the loading. FEA simulates real components to analyze problems pertaining to heat transfer, structural analysis, electromagnetic potential, and mass transport.

Computational fluid dynamics involves qualitative prediction of fluid flow using mathematical modeling and software tools. CFD is used in analyzing turbulence, flow, and pressure distribution of gasses & liquids and their interaction with different structures. The industry players are aiming at developing application-specific software for customized process functions. Furthermore, the multibody dynamic analysis is of two types: Inverse dynamics and forward dynamics. Forward dynamics analysis is the movement of individual components by the application of external forces. Inverse dynamics involves the analysis of forces to move the system in a specific way.

The service segment is expected to register the highest CAGR over the forecast period. The growth of the segment can be attributed to the growing awareness of virtually enabled processes used for product development among companies and governments. Services such as design and consulting, implementation, and maintenance are gaining popularity among various enterprises.

Deployment Model Insights

In 2022, the on-premise segment held a market share exceeding 60% in the global market and is expected to exhibit a CAGR of nearly 9.0% from 2023 to 2030. The software industry is a fast-paced industry and timely development and introduction of products to the market are vital to a firm’s success. Companies are obtaining new software technologies through mergers & acquisitions. Based on deployment models, the industry is segmented into on-premise and cloud. Cloud computing offers easy access to data, vast space for data storage, and security. Moreover, cloud-based CAE, offered as a Software-as-a-Service (SaaS), renders application-specific solutions to the CAE users. Hence, the cloud-based deployment model is expected to portray a high growth rate during the projected period.

Cloud-based deployment enables faster distribution, minimal maintenance, reduction in cost, and increase in scalability. Although the on-premise software implementation increased the software deployment cost along with up-gradation costs, the on-premise software installation held a significant share in the market in 2022. This high share of on-premise segment can be attributed to its early adoption. Additionally, deployment of software at the client’s site is considered a more convenient option by several companies where the data confidentiality issues persist. For similar reasons, the on-premise segment is expected to hold the majority share during the forecast period.

End-use Insights

Based on end-use, the industry is segmented into defense & aerospace, automotive, electronics, medical devices, industrial equipment, and others. In 2022, the automotive end-use industry held the largest market share of 27.06% in the global market and is expected to exhibit a significant CAGR from 2023 to 2030. In the automotive segment, the CAE software is used to analyze the feasibility of heat dissipation techniques such as cooling, ventilation, and aerodynamics.

The defense and aerospace end-use is expected to witness the highest growth rate over the forecast period, owing to the increasing use of CAE software.. The growing government spending in the defense & aerospace segment, for modernizing anti-terror equipment and mitigating security lapses, is anticipated to increase the growth of the segment. Further, the growing concerns about security & surveillance, in public places, are likely to influence the segment demand.

Additionally, advanced technologies such as Color Noise Reduction (CNR) for truer colors, Backside Illumination (BSI) for high sensitivity, and High Dynamic Range (HDR) for smooth and crisp video, are anticipated to provide opportunities for electronics segment growth. The medical imaging market is gaining traction in the market owing to its efficiency in diagnosing complex medical conditions. The rising prevalence of critical and chronic diseases, such as cardiovascular diseases & cancer, and increasing awareness of early diagnosis are the key factors driving the demand for imaging systems in healthcare facilities.

Regional Insights

In 2022, North America dominated the CAE market with a market share of 33.15% and is expected to continue its dominance over the forecast period owing to the presence of bio-diverse cultures and increasing automation in the manufacturing sector. The rising concerns about greenhouse gas emissions and the evolving battery technologies are anticipated to spur the North American regional market. Additionally, rapid penetration of IoT and increasing expenses for defense are a few factors influencing the North America regional market share.

The APAC regional market is expected to witness exponential growth over the forecast period with a CAGR of 13.2%. This growth can be attributed to the rising government investments for developing the manufacturing sector and expanding the capacity of renewable energy generation. The growing automation of industrial equipment is likely to drive the industry demand.

Key Companies & Market Share Insights

A few of the major industry players include Autodesk, Inc., Dassault Systemes, MSC Software Corporation, and Siemens AG. The industry players are constantly investing in R&D to develop differentiated products and stay ahead of the competition. Companies are obtaining new software technologies through mergers & acquisitions. They are aiming to create a strong customer base by investing in sales and marketing. With an established customer base, the existing players are constantly improving products through R&D; restricting start-ups and small companies from penetrating the market. The companies are offering specialized products and services to their customers at premium prices. This is expected to maintain the low bargaining power of the buyers. They are aiming to create a strong customer base by investing in sales and marketing. Some of the prominent players in the global computer aided engineering market include:

• ANSYS, Inc.  

• Altair Engineering

• Autodesk, Inc.

• Bentley Systems, Inc.

• Dassault Systemes

• ESI Group

• Exa Corporation

• Mentor Graphics Corporation (A subsidiary of Siemens AG)

• MSC Software Corporation (A subsidiary of Hexagon AB)

• Siemens AG

Computer Aided Engineering Market Report Scope

Global Computer Aided Engineering Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest trends and opportunities in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global computer aided engineering market report based on component, deployment models, end-uses, and regions:

• Component Outlook (Revenue, USD Million, 2017 - 2030)

  • Software

    • Finite Element Analysis (FEA)

    • Computational Fluid Dynamics (CFD)

    • Multibody dynamics

    • Optimization & simulation

  • Services

    • Development Service

    • Training, Support & Maintenance

• Deployment Model Outlook (Revenue, USD Million, 2017 - 2030)

  • On-premise

  • Cloud-based

• End-use Outlook (Revenue, USD Million, 2017 - 2030)

  • Automotive

  • Defense & aerospace

  • Electronics

  • Medical devices

  • Industrial equipment

  • Others

• Regional Outlook (Revenue, USD Million, 2017 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • U.K.

    • France

    • Italy

    • Spain

    • Russia

  • Asia Pacific

    • China

    • India

    • Japan

    • Singapore

    • South Korea

  • South America

    • Brazil

  • Middle East and Africa (MEA)