Home MARKETING Engineering Services: The Service Provider Market Is In A State Of Flux

Engineering Services: The Service Provider Market Is In A State Of Flux

The new study “The market for engineering services in India” by Lunendonk shows forecasts and trends from the point of view of user companies. Accordingly, the market is undergoing a fundamental change.

  • A new study by Lunendonk examined the engineering services market in India. The development and networking of embedded systems are therefore essential topics.
  • Modern concepts and technologies challenge the industries.
  • In addition, the market for engineering services is determined by changing customer requests and needs.

In the new study “The Market for Engineering Services in India”, the market researchers from Lunendonk & Hossenfelder have examined forecasts, trends and developments from the perspective of medium-sized and large user companies. In cooperation with the companies Brunel, Edge, Capgemini and Akkodis, an insight was gained into the market of those companies that operate in the engineering services segment and purchase external services. An essential result of the study: the market has been undergoing a fundamental change for some time. This is mainly due to structural changes in important customer industries. But the legal changes in recent years concerning temporary employment also influence decisions, budgets and measures.

Engineering Services: New Technologies Challenge The Industry

“According to our surveys, the automotive industry, one of the most important customer sectors for engineering service providers, is currently confronted with numerous new and changing challenges. This ranges from the electrification of the drive components to the digitization of production, sales channels and the actual product to the networking of vehicles. For manufacturers, the user experience in the vehicle, autonomous driving and the establishment of new business models are increasingly becoming drivers in this market segment.”

Changing Customer Needs Determine The Market

It’s no longer a secret that the user-friendliness of infotainment and driver assistance systems and the integration of mobile devices in the vehicle are critical arguments in customers’ purchasing decisions in the automotive sector. For more than half of the user companies surveyed, in addition to the engineering service providers, product development and OT/IT integration are among the essential tasks in digitization.

According to the study results, the development of embedded systems and their networking with other systems and backend IT are among the two most important topics for 43 per cent of the user companies surveyed in the next two years. At the same time, only every second manager investigated rates their in-house competence in developing embedded systems as high.

With a view to budget development in 2022, 66 per cent of the user companies surveyed want to increase their spending on networking and digitising core processes (OT/IT). At the same time, 65 percent plan to increase their spending on data insights. Fifty-seven per cent want to increase investments in the development and integration of embedded systems. Concerning the share of embedded systems in the products, 40 percent of the user companies surveyed assume that their products will be based almost entirely on software in 2022.

Engineering Services: Preferred Partners Are Preferred

Concerning cooperation with service providers of engineering services, 44 per cent of the user companies prefer preferred partners for specific topics. But just as many also respond to individual tenders, for example, in the case of innovation topics. Concerning the cooperation models, however, 51% of the user companies continue using temporary workers. Eleven per cent, on the other hand, often award development projects to a service partner as a complete trade. For another 32 per cent, this still happens sometimes.

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