Aerospace Engineering Services Outsourcing Market Size, Share, Trends, Growth 2030

Aerospace Engineering Services Outsourcing Industry Prospective:

The global aerospace engineering services outsourcing market size was worth around USD 78.14 billion in 2022 and is predicted to grow to around USD 312.55 billion by 2030 with a compound annual growth rate (CAGR) of roughly 18.92% between 2023 and 2030.

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The report analyzes the global aerospace engineering services outsourcing market drivers, restraints/challenges, and the effect they have on the demands during the projection period. In addition, the report explores emerging opportunities in the aerospace engineering services outsourcing industry.

Aerospace Engineering Services Outsourcing Market: Overview

Aerospace engineering services outsourcing is the process of taking the help of external service providers for aerospace engineering activities. It involves delegating some or all of the several engineering tasks and processes that are a part of the growing aerospace industry. However, the agencies providing these services should be specialists or experts in managing the assigned task or process. Several crucial activities come together to assist in the safe and successful functioning of processes involved in aerospace engineering. This includes design, analysis, testing, manufacturing support, maintenance, repair, and overhaul, and research & development. They are critical for the aerospace sector to operate successfully and are essential for events such as the design and production of aircraft, spacecraft, satellites, and related components. In current times, outsourcing aerospace engineering services has become an extremely common practice and the market for the same is expected to grow at a steady rate during the forecast period.

Key Insights:

• As per the analysis shared by our research analyst, the global aerospace engineering services outsourcing market is estimated to grow annually at a CAGR of around 18.92% over the forecast period (2023-2030)
• In terms of revenue, the global aerospace engineering services outsourcing market size was valued at around USD 78.14 billion in 2022 and is projected to reach USD 312.55  billion, by 2030.
• The aerospace engineering services outsourcing market is projected to grow at a significant rate due to the growing advancements and complexities in aerospace systems
• Based on location segmentation, onshore was predicted to show maximum market share in the year 2022
• Based on function segmentation, the maintenance process was the leading function in 2022
• On the basis of region, North America was the leading revenue generator in 2022

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Aerospace Engineering Services Outsourcing Market: Growth Drivers

Growing advancements and complexities in aerospace systems to drive market growth

The global aerospace engineering services outsourcing market is projected to grow owing to the increasing complexities and advancements in the aerospace industry. These systems are getting steadily complex influenced by several factors. For instance, almost all developed and developing nations have increased their spending on space exploration activities in terms of launching new satellites orbiting the planet or developing spaceships to reach the moon and other planets. Such systems are highly complex as they make use of advanced technologies such as quantum computing, and big data, along with mechanical innovations. Furthermore, the design, development, manufacturing, maintenance, and repair of modern-age spacecraft require engineering knowledge and associated science. Hence, companies outsource certain processes to businesses that have gained expertise in conducting aerospace engineering services which enable the sector to manage complex engineering challenges effectively.

Aerospace Engineering Services Outsourcing Market: Restraints

Intellectual property protection to restrict market expansion

Aerospace companies are equipped with highly confidential data. They have a significant volume of sensitive and proprietary information. When outsourcing certain engineering processes, companies have to ensure that such information is not leaked to other companies. There is always an associated risk of unauthorized access, data breaches, or intellectual property theft which leads to businesses deterring from outsourcing engineering services to new service providers. For instance, a report by Security Boulevard claimed that the aviation sector registered 52 cyber-attack crimes in 2020.

Aerospace Engineering Services Outsourcing Market: Opportunities

Geographical expansion and market penetration to provide growth opportunities

The aerospace industry is one of the most resource-intensive sectors. For successful functioning, it requires large resources including monetary and non-monetary. This has resulted in companies joining strategic partnerships which allow them to distribute every aspect of the business including risk and profit. With the growing partnerships between aerospace companies across geographical locations along with the increasing need for market penetration, the global sales volume of the aerospace engineering services outsourcing market may be positively impacted in the coming years.

Aerospace Engineering Services Outsourcing Market: Challenges

Effective communication and collaboration to challenge market expansion

One of the key challenges faced by the aerospace engineering services outsourcing industry is the establishment of effective communication and collaboration between service providers and takers. This is especially applicable in the case of parties that are separated geographically and have language barriers. They are prone to misunderstandings, delays, and misalignment of expectations which impacts the overall project efficiency.

Aerospace Engineering Services Outsourcing Market: Segmentation

The global aerospace engineering services outsourcing market is segmented based on location, component, function, service, and region.

Based on location, the global market segments are offshore and onshore. The industry witnessed the highest growth in the onshore segment in 2022. It is expected to grow at a CAGR of over 25% during the forecast period. Several benefits associated with onshore outsourcing are the main reasons for the high growth rate. For instance, companies can work with specializing partners existing in their time zone which makes communication more effective. Furthermore, since involved parties exist in the same legal jurisdiction, it becomes easy to understand and develop new technologies without worrying about legal repercussions. The aerospace sector is currently witnessing high demand and use of Manufacturing-as-a-Service (MaaS) which can assist in delaying shipments and meeting targets on time.

Based on component, the global aerospace engineering services outsourcing industry is divided into software and hardware.

Based on function, the global industry is divided into maintenance process, production process, design, and simulation & digital validation. The highest market share was owned by the maintenance process segment in 2022. It is expected to grow at a CAGR of 24.56% during the forecast period. It refers to the undertaking aid from external parties for maintaining, repairing, and overhauling (MRO) activities of an aircraft. This requires the responsible party to ensure timely inspection, repair, and determining airworthiness of aircraft. There are several aspects of such activities. For instance, line maintenance deals with inspection & repair at regular intervals or between flights and includes processes such as fluid checks, component replacements, minor repairs, and system inspections.

Based on service, the global aerospace engineering services outsourcing industry is segmented into embedded software engineering, mechanical engineering, electric/electronic engineering, and others.

Recent Developments:

• In April 2022, Rolls-Royce, one of the world’s most renowned industrial technology companies, inaugurated the Aerospace Engineering and Digital Innovation Centre in India, in partnership with Infosys, a next-generation digital consulting and service provider. This center is expected to become home to all research & development for engineering activities led by Rolls-Royce
• In September 2022, Boeing, a US-based designer, manufacturer, and supplier of rockets, aircraft, and other aerial technologies, announced that it plans to outsource more accounting and finance-related jobs to India through Tata Consultancy Services. This came in after the company also announced 150 job cuts in its home nation in the first batch of layoffs

Aerospace Engineering Services Outsourcing Market: Report Scope

Aerospace Engineering Services Outsourcing Market: Regional Analysis

North America to continue its growth trend over the coming years

The global aerospace engineering services outsourcing market is projected to be dominated by North America during the forecast period. It is expected to grow at a CAGR of over 24% by 2030 and will be primarily led by the stronghold of the US region in the aerospace engineering sector. The regional growth is led by factors such as the rapid expansion of aerospace technologies in private, public, and military suppliers of aerospace engineering. Moreover, the large presence of industry experts is of crucial importance which is further strengthened by rising investments in amping up strategic collaboration with domestic and international partners.

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As the US continues to spend on innovations in the Information Technology (IT) sector along with enterprise software systems and data center units, the regional growth will continue to be steady. In recent times, the private segment of the US aerospace industry has witnessed aggressive growth with companies such as SpaceX working toward space exploration which could further fuel the market expansion trajectory.

Aerospace Engineering Services Outsourcing Market: Competitive Analysis

The global aerospace engineering services outsourcing market is led by players like:

• Airbus
• Boeing
• Lockheed Martin
• Safran
• GE Aviation
• Rolls-Royce
• Northrop Grumman
• Thales Group
• Honeywell Aerospace
• Bombardier Aerospace
• Raytheon Technologies Corporation
• Collins Aerospace
• L3Harris Technologies
• BAE Systems
• Leonardo S.p.A.
• Meggitt PLC
• Textron Inc.
• Spirit AeroSystems
• CAE Inc.
• UTC Aerospace Systems
• General Dynamics
• AAR Corporation
• Dassault Aviation
• Embraer
• Kawasaki Heavy Industries.

The global aerospace engineering services outsourcing market is segmented as follows:

By Location

• Offshore
• Onshore

By Component

• Software
• Hardware

By Function

• Maintenance Process
• Production Process
• Design
• Simulation & Digital Validation

By Service

• Embedded Software Engineering
• Mechanical Engineering
• Electric/Electronic Engineering
• Others

By Region

• North America
  • The U.S.
  • Canada
• Europe
  • France 
  • The UK
  • Spain
  • Germany
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • South Africa
  • Rest of Middle East & Africa