Mechanical Engineering? Wanted again!

Traditional engineering streams like Mechanical are back in demand and I’m going to get to the why, right away!

Table of Contents

  • Mechanical Engineering Scope in India
  • Mechanical Engineering and the Auto Industry
  • New Talent Frontier

It is a well-known fact that, in the last two decades, core engineering graduates moved to the IT sector. With the downturn and uncertainty in the software industry, demand for engineers has been decreasing. But there’s been an emerging sector – Engineering R&D. This sector has been steadily growing and attracting traditional core engineering disciplines such as:

  • Mechanical Engineering
  • Electrical Engineering
  • Architecture
  • Aeronautical Engineering
  • Automobile Engineering

Engineering R&D, complemented by the domestic Automotive sector, has given a thrust to the vast engineering talent in India. Engineering R&D is making a global impact to become the go-to destination for high-end engineering and research work. It is one of the few areas in which India beats China in terms of attracting foreign investment!

India Story

India has become the world’s second-largest hub for the Engineering Research talent pool after Western Europe. Most of the world’s biggest companies have set-up their Engineering Centres or Captives as they are known. The rest who did not are now toeing the line. Engineering Captives were set-up for cost-effectiveness and as a pilot option to an offshore service provider. This gradually transitioned to Centres of Excellence offering innovation and high in-demand niche skills to support the parent company.

In the digital world, the buzz is around automation, digital transformation, IOT, connectivity, and mobility.  These Engineering Captives will play a significant role in building innovative solutions and products. They will help the companies to stay ahead and unlock new opportunities from existing products.

Big and small companies from across the world and across sectors have invested in setting up Engineering Captives. Sectors like Automotive, Aerospace, Consumer Electronics, Semiconductors, Energy, Utilities and Telecom have taken the lead. Daimler, General Motors, Renault Nissan, Robert Bosch, Cisco, Boeing, EADS, Samsung, Intel, Schneider, Shell, GE, Honeywell are already here. There are over 30 core Automotive Engineering R&Ds and over 1000 Captives across sectors. They employ over 300,000 professionals that offer opportunities across engineering streams.

Mechanical Engineering and Auto Industry

  • The global Automotive Engineering market is valued at US$ 265 billion. The Indian Automotive Engineering service providers address only a fraction of this market.
  • The Auto sector is one of the most important contributors to GDP and employment in India. It accounts for 7% of India’s GDP, 45% of manufacturing GDP and employs about 19 million people directly and indirectly.
  • The Auto & Auto Component sector has the potential to generate up to $300 billion in annual revenue by 2026. It can create 65 million additional jobs, as per Society of Indian Automobile Manufacturers (SIAM) and Government of India. It also envisions the industry to grow around four times by FY26.
  • Large presence of Global Automotive OEMs, Component Suppliers, and Engineering Captives.
  • Automotive Sector is a clear leader in R&D spending, the sector contributes to 18% of the global R&D spend.
  • Top Automotive R&D spenders have already set-up captives in India.
  • According to a new study by consulting firm Zinnov $31 billion was spent globally on engineering-related R&D. In this India alone accounted for $12.3 billion.
  • 69% of all offshore R&D centres which opened in 2015 were based in India.
  • The Government’s push to manufacturing through the ‘Make in India’ initiative has garnered considerable attention from the industry. This has brought the spotlight back on the manufacturing sector.
  • Salaries for entry-level roles are better than other industries with excellent growth opportunities. The prospects to interact with global teams, learn latest skills, overseas career opportunities are plenty.
  • Automotive regulations are likely to focus on making transport cleaner (electric, hybrid) and safer. This is fuelling the need for more Engineers to innovate.

New Talent Frontier

This could well be the new golden frontier for Indian talent for the next 15 years. It is an opportunity to leverage on our traditional manufacturing sector hubs to establish ourselves as a manufacturing destination. This should allow us to improve our manufacturing by investing in R&D. It would allow us to address the needs of the digital age through our high-calibre engineering and software talent.

The 1.5 million engineers India produces every year is enough to meet the demands of the Auto industry. The challenge is in bridging the skill demand the industry has been complaining about for a long time, now. However, the arrival and expansion of Engineering Captives is a shot in the arm for engineers graduating from traditional streams.

If you know a student who is confused about which engineering stream to pick, without batting an eyelid, say ‘Mechanical!’



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