Global Aerospace Engineering Services Outsourcing Market Size, Share & Trends Analysis Report, By Service (Mechanical Engineering, Electric/Electronic Engineering, Embedded Software Engineering, Others), By Function (Design, Simulation & Digital Validation, Production Process, Maintenance Process), By Location (On-shore, Off-shore), By Component (Hardware, Software), and Regional Forecasts 2022-2032
The Global Aerospace Engineering Services Outsourcing (ESO) Market is valued at approximately USD 116.95 billion in 2023 and is anticipated to grow with a robust CAGR of 24.9% over the forecast period 2024-2032. The market growth is primarily driven by the rising complexity of aerospace technologies, growing demand for cost-efficient operations, and the need to focus on core competencies by outsourcing specialized engineering tasks.
Engineering services outsourcing has become a strategic approach for aerospace companies to enhance their capabilities and reduce overhead costs. It enables companies to access a global talent pool, optimize design processes, reduce production cycles, and achieve faster time-to-market. The increased adoption of advanced materials, autonomous flight systems, and embedded software solutions in the aerospace industry has further boosted the demand for ESO services across commercial, military, and private aviation sectors.
Technological Advancements: The aerospace industry is witnessing the integration of cutting-edge technologies such as artificial intelligence (AI), machine learning (ML), Internet of Things (IoT), and data analytics. These technologies demand specialized engineering skills for designing, testing, and maintaining components, which ESO providers deliver at scale.
Rising Commercial Air Traffic: Rapidly increasing passenger traffic, particularly in Asia Pacific and the Middle East, has led to fleet expansion by airlines. The growing number of aircraft orders necessitates extensive engineering support, fueling the demand for design, simulation, and production outsourcing services.
Post-Pandemic Recovery and Industry Resilience: The aviation sector’s recovery from the COVID-19 pandemic has brought a surge in maintenance, repair, and overhaul (MRO) activities. Engineering service providers play a critical role in assisting companies to optimize operations and manage aging aircraft fleets.
Cost Optimization and Globalization of Talent Pools: Companies in the aerospace sector face pressure to remain competitive while meeting stringent safety and efficiency standards. By outsourcing engineering tasks to regions with a lower cost of talent, such as India and Southeast Asia, organizations can achieve cost savings without compromising quality.
Regional Insights- North America dominated the aerospace ESO market in 2023, accounting for 34.4% of global revenue. The region's well-established aerospace ecosystem, including leading players like Boeing, Lockheed Martin, and Raytheon Technologies, drives the demand for outsourced engineering solutions. The U.S. market, supported by a robust R&D base and substantial investments in advanced technologies, continues to lead the global aerospace industry.
Asia Pacific is poised to grow at the fastest CAGR during the forecast period, propelled by surging air passenger traffic, increased defense spending, and government initiatives to boost local manufacturing capabilities. India, in particular, has emerged as a hub for aerospace engineering services outsourcing, owing to its vast pool of qualified engineers and competitive labor costs.
Europe remains a significant market for ESO services, led by prominent OEMs such as Airbus and Rolls-Royce. The region's focus on sustainability and innovation has fueled demand for advanced engineering services to develop lightweight and fuel-efficient aircraft.
Major Market Players Included in This Report:
1. Altair Engineering Inc.
2. Alten Group
3. Capgemini
4. Bertrandt AG
5. EWI
6. Honeywell International Inc.
7. ITK Engineering GmbH
8. L&T Technology Services Limited
9. LISI GROUP
10. Teledyne Technologies Incorporated
11. BAE Systems
12. L3Harris Technologies, Inc.
13. Elbit Systems Ltd.
14. RTX
15. Sogeti
The Detailed Segments and Sub-segment of the Market Are Explained Below:
By Service
Engineering services outsourcing has become a strategic approach for aerospace companies to enhance their capabilities and reduce overhead costs. It enables companies to access a global talent pool, optimize design processes, reduce production cycles, and achieve faster time-to-market. The increased adoption of advanced materials, autonomous flight systems, and embedded software solutions in the aerospace industry has further boosted the demand for ESO services across commercial, military, and private aviation sectors.
Technological Advancements: The aerospace industry is witnessing the integration of cutting-edge technologies such as artificial intelligence (AI), machine learning (ML), Internet of Things (IoT), and data analytics. These technologies demand specialized engineering skills for designing, testing, and maintaining components, which ESO providers deliver at scale.
Rising Commercial Air Traffic: Rapidly increasing passenger traffic, particularly in Asia Pacific and the Middle East, has led to fleet expansion by airlines. The growing number of aircraft orders necessitates extensive engineering support, fueling the demand for design, simulation, and production outsourcing services.
Post-Pandemic Recovery and Industry Resilience: The aviation sector’s recovery from the COVID-19 pandemic has brought a surge in maintenance, repair, and overhaul (MRO) activities. Engineering service providers play a critical role in assisting companies to optimize operations and manage aging aircraft fleets.
Cost Optimization and Globalization of Talent Pools: Companies in the aerospace sector face pressure to remain competitive while meeting stringent safety and efficiency standards. By outsourcing engineering tasks to regions with a lower cost of talent, such as India and Southeast Asia, organizations can achieve cost savings without compromising quality.
Regional Insights- North America dominated the aerospace ESO market in 2023, accounting for 34.4% of global revenue. The region's well-established aerospace ecosystem, including leading players like Boeing, Lockheed Martin, and Raytheon Technologies, drives the demand for outsourced engineering solutions. The U.S. market, supported by a robust R&D base and substantial investments in advanced technologies, continues to lead the global aerospace industry.
Asia Pacific is poised to grow at the fastest CAGR during the forecast period, propelled by surging air passenger traffic, increased defense spending, and government initiatives to boost local manufacturing capabilities. India, in particular, has emerged as a hub for aerospace engineering services outsourcing, owing to its vast pool of qualified engineers and competitive labor costs.
Europe remains a significant market for ESO services, led by prominent OEMs such as Airbus and Rolls-Royce. The region's focus on sustainability and innovation has fueled demand for advanced engineering services to develop lightweight and fuel-efficient aircraft.
Major Market Players Included in This Report:
1. Altair Engineering Inc.
2. Alten Group
3. Capgemini
4. Bertrandt AG
5. EWI
6. Honeywell International Inc.
7. ITK Engineering GmbH
8. L&T Technology Services Limited
9. LISI GROUP
10. Teledyne Technologies Incorporated
11. BAE Systems
12. L3Harris Technologies, Inc.
13. Elbit Systems Ltd.
14. RTX
15. Sogeti
The Detailed Segments and Sub-segment of the Market Are Explained Below:
By Service
- Mechanical Engineering
- Electric/Electronic Engineering
- Embedded Software Engineering
- Others
- Design
- Simulation & Digital Validation
- Production Process
- Maintenance Process
- On-shore
- Off-shore
- Hardware
- Software
- Software Licensing
- Software Services
- North America
- U.S.
- Canada
- Mexico
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia Pacific
- Japan
- China
- India
- South Korea
- Rest of Asia Pacific
- Latin America
- Brazil
- Rest of Latin America
- Middle East & Africa
- Saudi Arabia
- South Africa
- Rest of Middle East & Africa
- Historical year – 2022
- Base year – 2023
- Forecast period – 2024 to 2032
- Market Estimates & Forecast for 10 years from 2022 to 2030.
- Annualized revenues and regional-level analysis for each market segment.
- Detailed analysis of the geographical landscape with country-level insights.
- Competitive landscape analysis with profiles of key players.
- Analysis of key business strategies and recommendations for future market approaches.
- Demand-side and supply-side market analysis.
CHAPTER 1. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET EXECUTIVE SUMMARY
1.1. Global Aerospace Engineering Services Outsourcing Market Size & Forecast (2022-2032)
1.2. Regional Summary
1.3. Segmental Summary
1.3.1. By Service
1.3.2. By Function
1.3.3. By Location
1.3.4. By Component
1.4. Key Trends
1.5. Recession Impact
1.6. Analyst Recommendations & Conclusion
CHAPTER 2. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET DEFINITION AND RESEARCH ASSUMPTIONS
2.1. Research Objective
2.2. Market Definition
2.3. Research Assumptions
2.3.1. Inclusion & Exclusion
2.3.2. Limitations
2.3.3. Supply-Side Analysis
2.3.4. Demand-Side Analysis
2.4. Estimation Methodology
2.5. Years Considered for the Study
2.6. Currency Conversion Rates
CHAPTER 3. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET DYNAMICS
3.1. Market Drivers
3.1.1. Growth in Passenger Traffic
3.1.2. Rising Complexity in Aerospace Engineering
3.1.3. Cost Optimization through Outsourcing
3.2. Market Challenges
3.2.1. Security Concerns in Offshore Projects
3.2.2. High Dependency on Skilled Labor Availability
3.3. Market Opportunities
3.3.1. Adoption of AI and Simulation Technologies
3.3.2. Expansion in Emerging Economies
CHAPTER 4. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET INDUSTRY ANALYSIS
4.1. Porter’s 5 Force Model
4.1.1. Bargaining Power of Suppliers
4.1.2. Bargaining Power of Buyers
4.1.3. Threat of New Entrants
4.1.4. Threat of Substitutes
4.1.5. Competitive Rivalry
4.2. PESTEL Analysis
4.2.1. Political
4.2.2. Economic
4.2.3. Social
4.2.4. Technological
4.2.5. Environmental
4.2.6. Legal
4.3. Top Investment Opportunities
4.4. Top Winning Strategies
4.5. Analyst Recommendations & Conclusion
CHAPTER 5. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY SERVICE (2022-2032)
5.1. Segment Dashboard
5.2. Global Market: Service Revenue Trend Analysis, 2022 & 2032 (USD Billion)
5.2.1. Mechanical Engineering
5.2.2. Electric/Electronic Engineering
5.2.3. Embedded Software Engineering
5.2.4. Others
CHAPTER 6. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY FUNCTION (2022-2032)
6.1. Segment Dashboard
6.2. Global Market: Function Revenue Trend Analysis, 2022 & 2032 (USD Billion)
6.2.1. Design
6.2.2. Simulation & Digital Validation
6.2.3. Production Process
6.2.4. Maintenance Process
CHAPTER 7. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY LOCATION (2022-2032)
7.1. Segment Dashboard
7.2. Global Market: Location Revenue Trend Analysis, 2022 & 2032 (USD Billion)
7.2.1. On-shore
7.2.2. Off-shore
CHAPTER 8. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY COMPONENT (2022-2032)
8.1. Segment Dashboard
8.2. Global Market: Component Revenue Trend Analysis, 2022 & 2032 (USD Billion)
8.2.1. Hardware
8.2.2. Software
8.2.2.1. Software Licensing
8.2.2.2. Software Services
CHAPTER 9. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY REGION (2022-2032)
9.1. North America
9.1.1. U.S.
9.1.2. Canada
9.1.3. Mexico
9.2. Europe
9.2.1. UK
9.2.2. Germany
9.2.3. France
9.2.4. Italy
9.2.5. Spain
9.3. Asia Pacific
9.3.1. Japan
9.3.2. China
9.3.3. India
9.3.4. South Korea
9.4. Latin America
9.4.1. Brazil
9.5. Middle East & Africa
9.5.1. Saudi Arabia
9.5.2. South Africa
CHAPTER 10. COMPETITIVE INTELLIGENCE
10.1. Key Company SWOT Analysis
10.1.1. Altair Engineering Inc.
10.1.2. Alten Group
10.1.3. Honeywell International Inc.
10.2. Top Market Strategies
10.3. Company Profiles
10.3.1. Bertrandt AG
10.3.2. ITK Engineering GmbH
10.3.3. L&T Technology Services Limited
10.3.4. Teledyne Technologies Incorporated
10.3.5. BAE Systems
CHAPTER 11. RESEARCH PROCESS
11.1. Research Process
11.1.1. Data Mining
11.1.2. Analysis
11.1.3. Market Estimation
11.1.4. Validation
11.1.5. Publishing
1.1. Global Aerospace Engineering Services Outsourcing Market Size & Forecast (2022-2032)
1.2. Regional Summary
1.3. Segmental Summary
1.3.1. By Service
1.3.2. By Function
1.3.3. By Location
1.3.4. By Component
1.4. Key Trends
1.5. Recession Impact
1.6. Analyst Recommendations & Conclusion
CHAPTER 2. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET DEFINITION AND RESEARCH ASSUMPTIONS
2.1. Research Objective
2.2. Market Definition
2.3. Research Assumptions
2.3.1. Inclusion & Exclusion
2.3.2. Limitations
2.3.3. Supply-Side Analysis
2.3.4. Demand-Side Analysis
2.4. Estimation Methodology
2.5. Years Considered for the Study
2.6. Currency Conversion Rates
CHAPTER 3. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET DYNAMICS
3.1. Market Drivers
3.1.1. Growth in Passenger Traffic
3.1.2. Rising Complexity in Aerospace Engineering
3.1.3. Cost Optimization through Outsourcing
3.2. Market Challenges
3.2.1. Security Concerns in Offshore Projects
3.2.2. High Dependency on Skilled Labor Availability
3.3. Market Opportunities
3.3.1. Adoption of AI and Simulation Technologies
3.3.2. Expansion in Emerging Economies
CHAPTER 4. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET INDUSTRY ANALYSIS
4.1. Porter’s 5 Force Model
4.1.1. Bargaining Power of Suppliers
4.1.2. Bargaining Power of Buyers
4.1.3. Threat of New Entrants
4.1.4. Threat of Substitutes
4.1.5. Competitive Rivalry
4.2. PESTEL Analysis
4.2.1. Political
4.2.2. Economic
4.2.3. Social
4.2.4. Technological
4.2.5. Environmental
4.2.6. Legal
4.3. Top Investment Opportunities
4.4. Top Winning Strategies
4.5. Analyst Recommendations & Conclusion
CHAPTER 5. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY SERVICE (2022-2032)
5.1. Segment Dashboard
5.2. Global Market: Service Revenue Trend Analysis, 2022 & 2032 (USD Billion)
5.2.1. Mechanical Engineering
5.2.2. Electric/Electronic Engineering
5.2.3. Embedded Software Engineering
5.2.4. Others
CHAPTER 6. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY FUNCTION (2022-2032)
6.1. Segment Dashboard
6.2. Global Market: Function Revenue Trend Analysis, 2022 & 2032 (USD Billion)
6.2.1. Design
6.2.2. Simulation & Digital Validation
6.2.3. Production Process
6.2.4. Maintenance Process
CHAPTER 7. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY LOCATION (2022-2032)
7.1. Segment Dashboard
7.2. Global Market: Location Revenue Trend Analysis, 2022 & 2032 (USD Billion)
7.2.1. On-shore
7.2.2. Off-shore
CHAPTER 8. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY COMPONENT (2022-2032)
8.1. Segment Dashboard
8.2. Global Market: Component Revenue Trend Analysis, 2022 & 2032 (USD Billion)
8.2.1. Hardware
8.2.2. Software
8.2.2.1. Software Licensing
8.2.2.2. Software Services
CHAPTER 9. GLOBAL AEROSPACE ENGINEERING SERVICES OUTSOURCING MARKET SIZE & FORECASTS BY REGION (2022-2032)
9.1. North America
9.1.1. U.S.
9.1.2. Canada
9.1.3. Mexico
9.2. Europe
9.2.1. UK
9.2.2. Germany
9.2.3. France
9.2.4. Italy
9.2.5. Spain
9.3. Asia Pacific
9.3.1. Japan
9.3.2. China
9.3.3. India
9.3.4. South Korea
9.4. Latin America
9.4.1. Brazil
9.5. Middle East & Africa
9.5.1. Saudi Arabia
9.5.2. South Africa
CHAPTER 10. COMPETITIVE INTELLIGENCE
10.1. Key Company SWOT Analysis
10.1.1. Altair Engineering Inc.
10.1.2. Alten Group
10.1.3. Honeywell International Inc.
10.2. Top Market Strategies
10.3. Company Profiles
10.3.1. Bertrandt AG
10.3.2. ITK Engineering GmbH
10.3.3. L&T Technology Services Limited
10.3.4. Teledyne Technologies Incorporated
10.3.5. BAE Systems
CHAPTER 11. RESEARCH PROCESS
11.1. Research Process
11.1.1. Data Mining
11.1.2. Analysis
11.1.3. Market Estimation
11.1.4. Validation
11.1.5. Publishing
