Automotive Transmission Engineering Services Outsourcing Market Report 2026

The automotive transmission engineering services outsourcing market size has grown strongly in recent years. It will grow from $13.21 billion in 2025 to $13.97 billion in 2026 at a compound annual growth rate (CAGR) of 5.7%. The growth in the historic period can be attributed to rising development of modern automotive powertrains, outsourcing growth in automotive engineering, increasing need for efficient transmission systems, cost optimization requirements in vehicle development, expansion of global automotive manufacturing.

The automotive transmission engineering services outsourcing market size is expected to see strong growth in the next few years. It will grow to $17.47 billion in 2030 at a compound annual growth rate (CAGR) of 5.8%. The growth in the forecast period can be attributed to growing shift toward hybrid and advanced drivetrains, rising complexity of transmission architectures, increasing reliance on specialized engineering partners, expanding digital simulation based design, rising automotive r&d outsourcing initiatives. Major trends in the forecast period include growing adoption of outsourced powertrain engineering, rising focus on advanced transmission efficiency enhancement, increasing shift toward hybrid and advanced automatic systems, expansion of simulation based transmission development, strengthening demand for cost optimized engineering support.

The growing demand for electric vehicles is anticipated to drive the expansion of the automotive transmission engineering services outsourcing market in the coming years. An electric vehicle is a type of vehicle powered by an electric motor that draws energy from a rechargeable battery and can be charged using an external power source. Outsourcing automotive transmission engineering services for electric vehicles allows manufacturers to access specialized expertise, optimize powertrain systems, lower development costs, and accelerate the creation of efficient, high-performance electric vehicles. For example, in April 2024, according to the International Energy Agency (IEA), a France-based energy analysis organization, nearly 14 million new electric cars were registered worldwide in 2023. Electric car sales in 2023 were 3.5 million higher than in 2022, representing a 35% year-on-year increase, and electric vehicles accounted for approximately 18% of all cars sold in 2023, up from 14% in 2022. This growth brought the total number of electric cars on roads globally to around 40 million. Consequently, the rising demand for electric vehicles is fueling the growth of the automotive transmission engineering services outsourcing market.

Major companies in the automotive transmission engineering services outsourcing market are implementing a strategic partnership approach to deliver propulsion solutions. Strategic partnerships involve companies utilizing each other's strengths and resources to achieve shared benefits and success. For example, in July 2024, Allison Transmission, a US-based firm that designs, develops, manufactures, and distributes transmissions and hybrid propulsion systems, formed a partnership with BAE Systems Hägglunds, a Swedish company specializing in the development, provision, and upgrade of vehicle systems. This recent collaboration highlights the continuation of a long-standing relationship between BAE Systems Hägglunds and Allison. It offers Allison the chance to further expand its presence in the Defense end market, with several programs expected to generate an additional $100 million in annual revenue.

In February 2025, Zenvo Automotive A/S, a Denmark-based automotive manufacturing company, partnered with Ricardo to develop the transmission system for its upcoming Aurora hypercar. Through this collaboration, Zenvo Automotive and Ricardo aim to integrate a customized 7-speed hybridized gearbox with the Aurora’s 6.6-liter quad-turbo V12 Mjølner engine to enhance performance and driving engagement, improve drivetrain efficiency, and ensure smooth delivery of power and torque across different speed ranges. Ricardo plc is a UK-based engineering and manufacturing consultancy that specializes in high-performance gearbox and driveline design, as well as transmission engineering for supercars and hypercars.

Major companies operating in the automotive transmission engineering services outsourcing market report are AVL List GmbH, FEV Group GmbH, IAV GmbH, Ricardo plc, Intertek Group plc, Bertrandt AG, EDAG Engineering GmbH, Tata Consultancy Services Limited, Marelli Europe SpA, Horiba Ltd., Porsche Engineering Group GmbH, Alten SA, P3 Automotive GmbH, Altair Engineering Inc., RLE International Group, ASAP Holding GmbH, Kistler Holding AG, M Plan GmbH, P+Z Engineering GmbH, Magna International Inc., Robert Bosch GmbH, Akka Technologies India Private Limited, ESG Group Pty Ltd., ITK Engineering GmbH, ZF Friedrichshafen AG, Jatco Ltd., Aisin Seiki Co. Ltd., Infosys Limited, Wipro Limited, HCL Technologies Limited, Tech Mahindra Limited, Capgemini SE.

Asia-Pacific was the largest region in the automotive transmission engineering services outsourcing market share in 2025. The regions covered in the automotive transmission engineering services outsourcing market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the automotive transmission engineering services outsourcing market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The automotive transmission engineering services outsourcing market includes revenues earned by entities by providing services such as backward vertical integration, conglomerate integration, forward vertical integration, horizontal integration. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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