Engineering Software Market Report 2025 (Global Edition)

Market Dynamics of Engineering Software 

Key Drivers

• Increasing acceptance of high-tech technologies, like 3D modeling and digitalization, to boost the engineering software market growth

Organizations are constantly looking for ways to increase productivity and effectiveness while decreasing project design in order to bring their products to market in the shortest amount of time possible and stay ahead of the competition. That is why several companies have switched from 2D to 3D technologies. Designers can more easily see the finished product and its parts thanks to 3D technologies. This shortens the design process, lowers costs, and shortens the project's duration by making design flaws easier to find. The software industry has accelerated the delivery of high-quality, customer-focused software solutions with the growing adoption of DevOps and Agile practices. In businesses that are digitally transforming, it has become a crucial component of business maturity. Thus, various players in the market have expand their product offerings with innovations and upgrades in 3D technology that can be implemented across various industries worldwide.
For Instance, PLM group partnered with Post process technologies to expand Automated Post-Processing Solution in Nordic and Baltic Regions. This new partnership will bring PostProcess technology to the Nordic, Baltic, and Iceland markets, providing local access to its full range of comprehensive solutions for post-processing 3D-printed parts.
(source https://www.postprocess.com/plm-pr/#:~:text=With%20this%20new%20partnership%2C%20PostProcess,additive%20manufacturing%20for%20their%20customers )
Moreover, the product enhancements and high innovations help towards digital transformation and further driving the engineering software market.

• Rising adoption of cloud-based engineering software due to the flexibility and collaborative nature of work drives the software engineering market

The increase in cloud-based engineering software adoption fuels global market growth, offering flexibility and scalability for remotes access and collaboration. Infrastructure and cloud components are becoming increasingly decentralized and more elastic due to the cloud computing industry’s extensive expansion. The computation, storage, and networking infrastructure as a service capability offer the basic resources required to deploy applications. Plenty of end-users utilize cloud-based structures to boost design flexibility and streamline operations. Since cloud-based solutions offer real-time work capabilities and reduce total expenditure on IT systems, some of the key players have moved their workloads to the cloud.
For Instance, Renesas launched cloud-based environment to accelerate automotive AI software development and evaluation. The new platform, AI Workbench, is an integrated virtual development environment that empowers automotive AI engineers to design, simulate and fine-tune their automotive software-all within the cloud.
(source https://www.renesas.com/us/en/about/press-room/renesas-launches-cloud-based-environment-accelerate-automotive-ai-software-development-and )
Overall, the increasing adoption of cloud-based engineering software is transforming the software engineering market by providing engineers with the tools they need to work with more flexibility, collaboratively, and efficiently.

Restraints

• Lack of standardization and the complexity of engineering software could impede engineering software market progress.

A vast number of features and tools are included in CAD, PLM, PDM, and design quality software, and the software becomes more difficult to use when multiple integrating technologies are used. Users may find such software challenging due to the complex nature, particularly if they are unfamiliar with it. Many engineers and designers search for feature enhancements that provide increased individual productivity and advance their understanding of engineering design procedures.
However, the software's complexity makes it challenging for new users to pick up and use, as well as for those who lack the time or resources to devote to training. A top-tier computer with plenty of RAM and storage space is needed for this sophisticated software. As a result, the software is less suitable with low-power gadgets like tablets and laptops and less portable. users may encounter difficulties in sharing files or transferring data between different platforms, leading to inefficiencies in collaboration and project management. Addressing these compatibility concerns requires efforts from software developers to standardize data formats, improve interoperability protocols, and enhance compatibility features to ensure smoother interactions between diverse engineering software tools. The complexity of such software tools leads to various issues, such as system difficulties in user operations, storage issues, high-cost errors, and others, thereby hampering overall software usage and development.

Opportunities

• The connectivity of AI and machine learning technologies is a growing opportunity in the engineering software market.

The integration of artificial intelligence (AI) and machine learning (ML) technologies expands numerous opportunities in the engineering software market. These advanced technologies enhance the capabilities of engineering software by enabling for business intelligence, automated design optimization, and intelligent decision-making processes. AI performance and efficiency machine learning algorithms can analyze vast quantities of engineering data in order to identify, optimize designs, and predict potential problems, thereby increasing overall in engineering workflows.
For Instance, in June 2024, US Marine Corps Integrating Artificial Intelligence and Machine Learning in their marines. The service depends on marines possessing the technical skills to make data legible to automated analytic systems and enable data-informed decisions.
(source https://warontherocks.com/2024/06/integrating-artificial-intelligence-and-machine-learning-in-the-marine-corps/ )
AI-enabled predictive analysis enables real-time decision-making, allowing businesses to adapt swiftly to dynamic market conditions and emerging challenges. Furthermore, the integration of AI and machine learning encourages innovation by making it easier to develop autonomous engineering systems and intelligent assistants. Engineers can use AI-powered tools to automate repetitive tasks like simulation setup and parameter optimization, freeing up their time for more complex and creative aspects of the design process. Furthermore, AI-powered insights allow engineers to make data-driven decisions, resulting in more informed design choices and, ultimately, superior engineering outcomes. As a result, the integration of AI and ML technologies enables engineering software vendors to provide more advanced, intelligent solutions that meet the changing needs of engineering professionals across industries.

Impact of Covid-19 on engineering software market

The global spread of the COVID-19 pandemic, which began in China, had a profound impact on industries around the world, with lockdowns and workforce restrictions disrupting industrial operations. Major engineering solutions markets, including the United States, Canada, the United Kingdom, Germany, France, Japan, and China, were significantly impacted, resulting in a decrease in demand for engineering software in the automotive and industrial equipment sectors. Despite a history of consistent growth, the engineering software industry suffered a temporary setback in 2020 as a result of halted operations and fewer new orders.\
However, with the transition to a emote work culture, software vendors offered support through discounts, trial extensions, and temporary free access to assist the shift of working models from office to home. For Instance, in March 2020, Hexagon Manufacturing Intelligence division is offering a range of free offline licensing and remote access options designed to enable efficient home working for manufacturing professionals facing new productivity challenges during the COVID-19 outbreak.
(source https://hexagon.com/company/newsroom/press-releases/2020/hexagon-supports-manufacturing-professionals-working-from-home )
Moreover, the requirement to innovate products, real time performance, and customer requirements with engineering software, such as PLM, CAD, QMS essential solutions across various industries, helped boost market growth.

Recent Developments

• In April 2024, Ansys presented AnsysGPT, an AI-powered virtual assistant. With a bigger knowledge base and advanced infrastructure, it offered 24-hour customer support, enhancing real-time response. AnsysGPT improved Ansys' AI+ products by providing curated knowledge and extensive multiphysics expertise, resulting in better response accuracy and customer experience.
• In November 2023, Esri announced a partnership with Autodesk to connect ArcGIS Living Atlas of the World layers and ArcGIS Basemaps into Autodesk products. The ArcGIS Living Atlas of the World layers and ArcGIS Basemaps will be included in the Autodesk product suite, supplying geographic data from the vastest list of global geographic information.
• In November 2022, Bentley Systems has launched Bentley Infrastructure Cloud, a suite of business solutions which covers a large infrastructure value chain and lifecycle. Bentley Infrastructure Cloud's comprehensive and continually updated digital twins enable the development, deployment, and maintenance of superior infrastructure.
   

The engineering software market is marked by a number of significant players and it is competitive. For a competitive advantage, these players are implementing alliances and teamwork tactics for getting effective customers and clients for their products. IBM is one of the leading companies in the market, as it offers an extensive range of software. To maintain its market position, the company focuses on expanding its product portfolio through acquisitions.

Frequently Asked Questions (FAQs)