Simulation Software Market 2030: The Intersection of AI and Simulation

The global simulation software market was valued at USD 23.56 billion in 2024 and is forecasted to rise to USD 51.11 billion by 2030, expanding at a CAGR of 14.0% from 2025 to 2030. Simulation software enables the virtual creation of real-time environments to test product and process performance and efficiency.

The market is expected to grow due to advantages such as lower production costs and reduced training expenses. Simulation tools are also crucial in evaluating military weapons and assisting automotive manufacturers in designing vehicle prototypes that help reduce CO₂ emissions.

Companies across industries increasingly adopt simulation software because it reduces production expenditures by allowing multiple virtual prototypes to be tested before physical production. This supports error-free output and prevents the manufacturing of faulty products, thereby lowering associated costs. It also shortens R&D timelines. Historically, manufacturers incurred high expenses when prototyping complex products, and even after building multiple prototypes, failures were common—leading to additional R&D spending.

High costs linked to prototype development and correcting product faults significantly increased pre- and post-production expenses. Simulation software mitigates these challenges by minimizing the need for repeated manual prototype testing and reducing the likelihood of product failures. As a result, organizations are investing more in simulation tools. Around the world, manufacturers are also investing in AI-related technologies to adapt to an increasingly Volatile, Uncertain, Complex, and Ambiguous (VUCA) environment. Virtual testing techniques are vital for evaluating the performance and behavior of AI-enabled devices in real-world scenarios.

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Key Market Trends & Insights

• North America led the global simulation software market with a 36.5% share in 2024. The region is expected to maintain its dominance due to the presence of major industry players in the U.S. and Canada, strong R&D investments, and a reputation for early adoption of advanced technologies.
• By component, the software segment captured the largest share at 68.5% in 2024 and is expected to remain the leading segment. This is driven by benefits including data safety, reliability, and continuous testing capabilities. Within this segment, finite element analysis (FEA) is projected to be a major contributor, widely used in industries such as automotive, aerospace, defense, and electronics for evaluating product design, performance, and quality.
• By deployment, the cloud-based segment is anticipated to record the fastest CAGR of 15.4% during the forecast period. Its rapid growth is attributed to easier implementation, cost-effectiveness, and simplified maintenance and upgrades. Cloud-based solutions are increasingly used in R&D and training & education applications.
• By application, the engineering, research, modeling & simulated testing segment held the largest share in 2024. This is due to strong adoption by major enterprises such as Airbus, Boeing, and Volkswagen Group for engineering, modeling, and testing. The segment’s growth is further supported by demand for rapid, cost-efficient quality enhancement that enables companies to introduce new products faster and with lower warranty expenses.
• By end use, the automotive sector dominated the market in 2024. The segment’s growth is driven by the early integration of virtual development tools and the industry’s transition toward electric and autonomous vehicles. Simulation is increasingly used to optimize production processes and support innovation in this sector.

Market Size & Forecast

• 2024 Market Size: USD 23.56 billion
• 2030 Projected Market Size: USD 51.11 billion
• CAGR (2025-2030): 14.0%
• North America: Largest market in 2024

Key Companies & Market Share Insights

Prominent companies in the simulation software industry include Dassault Systèmes and ANSYS, Inc., both of which focus on integrating advanced technologies to enhance their offerings and maintain competitiveness. Their strategies include mergers and acquisitions, product expansions, partnerships, and new launches.

• Dassault Systèmes develops 3D design, product lifecycle management, and digital mock-up solutions. Its extensive product portfolio spans 12 brands, including ENOVIA, CATIA, 3DEXCITE, SOLIDWORKS, DELMIA, GEOVIA, BIOVIA, SIMULIA, 3DVIA, EXALEAD, and NETVIBES.
• ANSYS, Inc. specializes in engineering simulation software and uses its Workbench platform to integrate a wide range of technologies. Its offerings include 3D design tools, electromagnetic field simulation, computational fluid dynamics, optical simulation, semiconductor analysis, structural analysis, and system modeling, simulation, and validation.

Key Players

• Altair Engineering, Inc.
• Autodesk Inc.
• Ansys, Inc.
• Bentley Systems, Incorporated
• Dassault Systèmes
• The MathWorks, Inc.
• Rockwell Automation, Inc.
• Simulations Plus
• ESI Group
• GSE Systems

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Conclusion

The simulation software market is poised for strong expansion, driven by its ability to reduce production, prototyping, and training costs while improving product quality and accelerating development cycles. Its rising adoption across industries—especially automotive, aerospace, defense, and electronics—is fueled by the growing complexity of products, the shift toward AI-enabled systems, and the increasing need for efficient virtual testing environments. With North America at the forefront and cloud-based solutions gaining traction, the market is expected to experience sustained growth through 2030 as companies continue to prioritize innovation, digital transformation, and cost-effective development processes.