Zinnov, a leading Management Consulting firm, released an exclusive study on the Automotive Electronics R&D Services market in India, with a specific focus on Product Engineering Services.
The study titled, "Automotive Electronics - Speeding on the Outsourcing Highway", pegged the market at approximately USD 200 billion. The total automotive electronics market of OEMs and Tier-1s stood at USD 204 billion in 2014 and is expected to reach a mark of USD 265 billion by 2018, it read.
Class A (like Daimler, Audi, Jaguar & BMW) & Tier-1 (Bosch, Denso, Continental & Delphi) companies are major outsourcers in the industry. Apart from Europe, the availability of large talent pool and the established R&D eco-system has made Bay Area (US), the R&D hub for automotive electronics.
The Zinnov study brought to light that OEMs' major R&D focus areas are concentrated around advanced transmission systems, electric vehicles and hybrid vehicle technology.
On the other hand, Tier-1s' R&D areas include ADAS, infotainment solutions and carrying out R&D on autonomous cars that are of hybrid version for creating a green environment. Additionally, it is witnessed that the number of embedded patents has grown up in the last 5 years along with the penetration of service providers in this space.
Embedded Patents Filed by Top OEMs in past 5 years ADAS - 23%
Embedded Patents Filed by Top Tier-1s in past 5 years ADAS - 25%
ADAS* - Advanced Driver Assistance Systems
Talking about the growth opportunity, Sidhant Rastogi, Partner & Practice Head, Zinnov, said, "Advanced Driver Assistance Systems and infotainment systems will see increased outsourcing and larger deals can be expected in next two-three quarters. The opportunities for service providers will continue to open up as we move towards a more connected world."
The Zinnov study brought to light that European service providers address the larger on-shore outsourcing piece when it comes to automotive electronics, whereas Indian service providers address a market of USD 320 million of the automotive electronics outsourcing market.
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