A three-pronged approach was followed for deducing the engineering services outsourcing market estimates and forecasts. The process has three steps: information procurement, analysis, and validation. The whole process is cyclical, and steps repeat until the estimates are validated. The three steps are explained in detail below:
Information procurement: Information procurement is one of the most extensive and important stages in our research process, and quality data is critical for accurate analysis. We followed a multi-channel data collection process for engineering services outsourcing market to gather the most reliable and current information possible.
Analysis: We mine the data collected to establish baselines for forecasting, identify trends and opportunities, gain insight into consumer demographics and drivers, and so much more. We utilized different methods of engineering services outsourcing market data depending on the type of information we’re trying to uncover in our research.
Market Research Efforts: Bottom-up Approach for estimating and forecasting demand size and opportunity, top-down Approach for new product forecasting and penetration, and combined approach of both Bottom-up and Top-down for full coverage analysis.
Value-Chain-Based Sizing & Forecasting: Supply-side estimates for understanding potential revenue through competitive benchmarking, forecasting, and penetration modeling.
Demand-side estimates for identifying parent and ancillary markets, segment modeling, and heuristic forecasting.
Qualitative Functional Deployment (QFD) Modelling for market share assessment.
Market formulation and validation: We mine the data collected to establish baselines for forecasting, identify trends and opportunities, gain insight into consumer demographics and drivers, and so much more. We utilize different methods of data analysis depending on the type of information we’re trying to uncover in our research.
Market Formulation: This step involves the finalization of market numbers. This step on an internal level is designed to manage outputs from the Data Analysis step.
Data Normalization: The final market estimates and forecasts are then aligned and sent to industry experts, in-panel quality control managers for validation.
This step also entails the finalization of the report scope and data representation pattern.
Validation: The process entails multiple levels of validation. All these steps run in parallel, and the study is forwarded for publishing only if all three levels render validated results.
The engineering services outsourcing market was categorized into four segments, namely service (Designing, Prototyping, System Integration, Testing), location (On-shore, Off-shore), application (Aerospace, Automotive, Industrial, Consumer Electronics, Semiconductors, Healthcare, Telecom), and regions (North America, Europe, Asia Pacific, South America, Middle East & Africa).
The engineering services outsourcing market was segmented into service, location, application, and regions. The demand at a segment level was deduced using a funnel method. Concepts like the TAM, SAM, SOM, etc., were put into practice to understand the demand. We at GVR deploy three methods to deduce market estimates and determine forecasts. These methods are explained below:
Demand estimation of each product across countries/regions summed up to from the total market.
Variable analysis for demand forecast.
Demand estimation via analyzing paid database, and company financials either via annual reports or paid database.
Primary interviews for data revalidation and insight collection.
Used extensively for new product forecasting or analyzing penetration levels.
Tool used invoice product flow and penetration models Use of regression multi-variant analysis for forecasting Involves extensive use of paid and public databases.
Primary interviews and vendor-based primary research for variable impact analysis.
The engineering services outsourcing market was analyzed at a regional level. The globe was divided into North America, Europe, Asia Pacific, South America, and Middle East & Africa, keeping in focus variables like consumption patterns, export-import regulations, consumer expectations, etc. These regions were further divided into ten countries, namely, the U.S.; Canada; Mexico; the UK.; Germany; France; China; Japan; India; Brazil.
All three above-mentioned market research methodologies were applied to arrive at regional-level conclusions. The regions were then summed up to form the global market.
The engineering services outsourcing market was analyzed via companies operating in the sector. Analyzing these companies and cross-referencing them to the demand equation helped us validate our assumptions and conclusions. Key market players analyzed include:
Alten GmbH - The ALTEN Group, established in 1988 and headquartered in Munich, Germany, is a leading provider of technology consulting and engineering services in Europe. Alten GmbH, based in Coburg, Germany, operates as a subsidiary of Alten SA. The company has a presence at 22 locations in Germany and offers integrated IT security solutions. Key services provided by the company include electrical/electronic hardware/software, mechanical design, production and process planning, quality management and project management (3P) for original equipment manufacturers (OEMs) in various industries ALTEN GmbH specializes in providing engineering services to key industries such as automotive, power engineering, semiconductors, aerospace, medical technology, and telecommunications. The company employs around 24,000 employees globally and has branches in Spain, Brazil, France, and the Benelux region.
HCL Technologies - HCL Technologies Pvt. Ltd. is an Indian multinational information technology (IT) consulting company headquartered in Noida, Uttar Pradesh, India. It provides IT and engineering services and solutions, including ER&D services, custom application services, business services, enterprise application services, enterprise transformation services, IT infrastructure and management services, and Gen 2.0 outsourcing. HCL’s Engineering Services unit engages in the development of engineering products, solutions, and platforms across various industries, including office automation, networking and telecom, medical devices, industrial manufacturing, consumer electronics, software, online, aerospace and defense, servers and storage for customers and semiconductors. HCL's engineering and R&D services business unit offers a wide array of solutions, including application test factory, electronic device automation testing, intelligent sustenance engineering, intelligent tech support, interactive electronic technical manuals, platform acceleration suite, product intelligence, and value analysis/value engineering.
Infosys Ltd. - Infosys is a global company that provides consulting, technology, and outsourcing solutions. Established in 1981, the company is headquartered in Bangalore, India, and has a global presence with offices and development centers worldwide. Infosys caters to more than 30 countries and provides strategic insights through consulting, operation leadership, and co-creation of solutions across mobility, big data, sustainability, and cloud computing. As of 2018, the company had 82 sales and marketing offices and 123 development centers across the world, with major locations in the United States, China, Australia, Japan, the Middle East, and Europe.
Tata Elxsi -A subsidiary of the Tata Group, Tata Elxsi is an India-based company headquartered in Bangalore, Karnataka. The company combines engineering, technology, and creativity to assist customers in translating ideas into solutions and products. Tata Elxsi functions in various sectors, including transportation, semiconductor, media & entertainment, healthcare, defense, consumer products, and communications. The company's operations are divided into four business divisions: embedded product design, industrial design, visual computing labs, and systems integration. Tata Elxsi has offices in the UK, UAE, U.S., South Africa, Singapore, Malaysia, Japan, Germany, France, and Dubai.
Tata Consultancy Services - Tata Consultancy Services (TCS) is an Indian multinational company that provides IT services, consultancy, and business solutions to clients across various industries. TCS is headquartered in Mumbai, Maharashtra, and is a part of the Tata Group. The company operates in 150 locations across 46 countries and has over 616,000 employees worldwide as of September 2023. TCS offers a consulting-led, integrated portfolio of engineering, business process services (BPS), infrastructure, IT, and assurance services. The company provides engineering and industrial services in multiple verticals, including aerospace & defense, automotive, life sciences, high tech, telecom, energy, metals & mining, utilities, earth moving & farm equipment, power machinery, retail, consumer packaged goods, and transportation. TCS has alliances with 31 academics, industrial, and technology partners, including Microsoft, Siemens, Intel, IBM, Google, and Automotive Research Association of India (ARAI), among others.
Tech Mahindra - Tech Mahindra is an India-based company headquartered in Pune, Maharashtra, which offers innovative customer-centric information technology services and solutions to associates, enterprises and society. Tech Mahindra is a part of the Mahindra Group. The company provides services to 632 global customers which include Fortune 500 companies. The company’s telecom, consulting and enterprise solutions connect across numerous technologies to deliver tangible business value to its stakeholders. Tech Mahindra offers integrated engineering solutions to multiple verticals which include energy & utilities, rail, medical devices, industrial, hi-tech, energy & utilities, aerospace & defense, consumer appliances and automotive. The company offers support for every phase of product development ranging from conceptual design and validation to manufacturing and aftermarket support.
Wipro Ltd. - Wipro Ltd. is an India-based information technology (IT), outsourcing and consulting company headquartered in Bangalore, Karnataka. The company’s product engineering solutions help in quick manufacturing through technology expertise in electronics and mechanical engineering, software, industry specific knowledge, partnerships and efficient processes. They help clients to manufacture consumer & retail products such as 3D cinemascope smart TVs, point of sale terminals, smart energy meters and portable dishwashers among others. Additionally, they enable the creation of enterprise/industrial products such as high performance computers, workforce management terminals, industrial grade wireless routers and base station controllers.
Furthermore, Wipro delivers custom engineered tele-health solutions, multi-screen TVs, managed printing solutions and automotive telematics & infotainment solutions. Wipro’s product compliance and certification labs help in minimizing post-deployment defects by carrying out rigorous tests on products designed for extreme conditions. Numerous industries benefit from the services provided by Wipro, such as operational real time data monitoring, product lifecycle management, plant visualization and engineering data management. The company serves clients in more than 175 cities across six continents.
Altair Engineering, Inc. - Altair Engineering, Inc. is a global technology company that provides software and cloud solutions in the areas of product development, high-performance computing (HPC), and data analytics. It was founded in 1985 and is headquartered in Troy, Michigan, U.S. Altair Engineering GmbH is a subsidiary of Altair Engineering, Inc., and is based in Boblingen, Germany. The company is segmented into three business divisions: Product Design (PD), HyperWorks CAE Software (HW), and PBS Works (PBS). It provides services such as industrial design, product engineering, technical staffing, analytics solutions, and HyperWorks solutions to OEMs and suppliers spread across the automotive, aerospace, defense & government, and consumer product segments. Altair Engineering, Inc. specializes in CAE Simulation and Optimization Technology, Product Engineering and Development, HPC and On-demand Computing, Industrial Design and Product Strategy Consulting, Business and Engineering Analytics Solutions, Technical Staffing Services, and the Internet of Things. It employs more than 2,800 employees and has more than 45 regional offices spread across 24 countries in the U.S., Europe, South America, and Asia. Its key clients include BMW, Fiat, Ford Motor Company, General Motors, Jaguar, Toyota, and Volkswagen.
P3 Automotive GmbH - P3 Automotive GmbH is a subsidiary of the P3 Group, which was founded in 1996 and is headquartered in Aachen, Germany. The P3 Group has around 3,000 employees worldwide and serves OEMs at over 40 locations across 15 countries. P3 Automotive GmbH has more than 900 employees globally and offers consulting services such as process optimization, strategy consulting, technology consulting services, and quality management. The company also provides management support services, including configuration, cost and complexity management services, and engineering solutions for use in the automotive market. P3 Automotive GmbH tests the entire electronics systems in Germany, U.S., Europe, Asia, Mexico, and other global centers.
Gigatronik - Gigatronik, founded in 2001, is a German company headquartered in Stuttgart, specializing in IT and electronics. The company provides domain-specific services to the automotive sector and has expanded its business to other industries such as construction machinery, agriculture, air and rail, electromobility, mobile work machines, medical technology, and building technology. In 2009, Gigatronik and Audi Electronics Venture GmbH formed a joint venture, establishing Fahrfahrksysteme GmbH (EFS), an electronic company that develops system software for chassis electronics for Volkswagen and AUDI AG. In 2015, an innovation and development center (IEZ) was established at Gaimersheim, which serves as the joint headquarter for Gigatronik and Fahrfahrksysteme GmbH. The company has been organized under two divisions: embedded solutions and IT solutions. In March 2017, AKKA Technologies, a key engineering and technology consulting provider in the mobility domain, acquired Gigatronik. The acquisition gave AKKA a new dimension in Germany, where it now generates €500 million in revenue, consolidating its position as a leading multi-segment engineering consulting firm. Gigatronik employs 1,000 people across 14 sites in Germany, Austria, and Switzerland, and reported total revenue of €119 million in 2016
Supply Side Estimates
Company revenue estimation via referring to annual reports, investor presentations, and Hoover’s.
Segment revenue determination via variable analysis and penetration modeling.
Competitive benchmarking to identify market leaders and their collective revenue shares.
Forecasting via analyzing commercialization rates, pipelines, market initiatives, distribution networks, etc.
Demand side estimates
Identifying parent markets and ancillary markets
Segment penetration analysis to obtain pertinent
Heuristic forecasting with the help of subject matter experts
Forecasting via variable analysis
Understanding market dynamics (in terms of drivers, restraints, & opportunities) in the countries.
Understanding trends & variables in the individual countries & their impact on growth and using analytical tools to provide high-level insights into the market dynamics and the associated growth pattern.
Understanding market estimates and forecasts (with the base year as 2021, historic information from 2018 to 2020, and forecast from 2022 to 2030). Regional estimates & forecasts for each category are available and are summed up to form the global market estimates.
The report provides market value for the base year 2022 and a yearly forecast till 2030 in terms of revenue/volume or both. The market for each of the segment outlooks has been provided on region & country basis for the above-mentioned forecast period.
The key industry dynamics, major technological trends, and application markets are evaluated to understand their impact on the demand for the forecast period. The growth rates were estimated using correlation, regression, and time-series analysis.
We have used the bottom-up approach for market sizing, analyzing key regional markets, dynamics, & trends for various products and end-users. The total market has been estimated by integrating the country markets.
All market estimates and forecasts have been validated through primary interviews with the key industry participants.
Inflation has not been accounted for to estimate and forecast the market.
Numbers may not add up due to rounding off.
Europe consists of EU-8, Central & Eastern Europe, along with the Commonwealth of Independent States (CIS).
Asia Pacific includes South Asia, East Asia, Southeast Asia, and Oceania (Australia & New Zealand).
Latin America includes Central American countries and the South American continent
Middle East includes Western Asia (as assigned by the UN Statistics Division) and the African continent.
GVR strives to procure the latest and unique information for reports directly from industry experts, which gives it a competitive edge. Quality is of utmost importance to us, therefore every year we focus on increasing our experts’ panel. Primary interviews are one of the critical steps in identifying recent market trends and scenarios. This process enables us to justify and validate our market estimates and forecasts to our clients. With more than 8,000 reports in our database, we have connected with some key opinion leaders across various domains, including healthcare, technology, consumer goods, and the chemical sector. Our process starts with identifying the right platform for a particular type of report, i.e., emails, LinkedIn, seminars, or telephonic conversation, as every report is unique and requires a differentiated approach.
We send out questionnaires to different experts from various regions/ countries, which is dependent on the following factors:
Report/Market scope: If the market study is global, we send questionnaires to industry experts across various regions, including North America, Europe, Asia Pacific, Latin America, and MEA.
Market Penetration: If the market is driven by technological advancements, population density, disease prevalence, or other factors, we identify experts and send out questionnaires based on region or country dominance.
The time to start receiving responses from industry experts varies based on how niche or well-penetrated the market is. Our reports include a detailed chapter on the KoL opinion section, which helps our clients understand the perspective of experts already in the market space.
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