1. Market Research
  2. > Manufacturing Market Trends
  3. > Aerospace and Defense

Business of military equipment and outer space projects: must-read reports and analysis

  • Currently 3/5 Stars.
  • 1
  • 2
  • 3
  • 4
  • 5
30 votes

Global Aerospace & Defense Manufacturing Industry


The global aerospace and defense manufacturing industry is worth $170 billion, according to the Society of Manufacturing Engineers. The industry involves the manufacture of defense goods, including information systems, watercraft, aircraft and weaponry. It is a highly concentrated market that sells mainly to governments who require products for military purposes or spacecraft for federal space programs.


Aerospace and defense manufacturing demand is driven by military budgets, the possibility of international warfare and airline traffic. The main success factors for companies in the industry are strong technical expertise and wise pricing of long-term contracts. Companies remain competitive by collaborating with partners and keeping costs down. Aerospace and defense manufacturing companies must collaborate with governments to remain compliant regarding regulations.


Key Market Segments


The worldwide market for airborne intelligence, surveillance and reconnaissance (ISR) was worth almost $17.5 billion in 2011, according to research from Visiongain. ISR is vital for military activities, and cutbacks affect defense budgets in many countries, though some areas spend more on defense. Despite budgetary restrictions, ISR typically still receives government funding.


The global military rotorcraft market is forecast to show yearly growth of over 4% by 2021, according to ICD Research. The market is comprised of attack and rescue, reconnaissance observation and maritime helicopters, among others. The market’s strong growth to come is due partly to the updating of EU and US fleets following the wars in Iraq and Afghanistan.


Reconnaissance, surveillance and target acquisition (RSTA) systems are necessary for all land-based military operations. Worldwide government spending on RSTA was over $3.35 billion in 2011, according to Visiongain. Widely used RSTA equipment includes counter-fire radar systems, surveillance sensors and night vision goggles.


The global market for unmanned aerial vehicles (UAV) was calculated to be worth almost $3 billion in 2011, according to research from Visiongain. The UAV market includes a range of products such as intelligence sensors, detection sensors, weaponry, infrared and lasers. Unmanned aircraft systems have also seen significant market growth over recent years as governments seek to acquire the best equipment to maximize their defense and attack systems. Companies operating in this market segment are according increasing amounts to research and development efforts to work on data links and ground control stations.


 Aerospace Industry Sales by Product Group, *In Current US$ Bn (2009-2012)



Growing Regional Market


India’s defense market is seeing rapid growth, with around $14 billion of the country’s 2010 administrative budget spent on acquiring military technology and hardware. India’s defense spending is forecast to grow at more than 6.5% a year in the five-year period ending 2015, to reach over $42.5 billion, according to Eprobe. Factors driving the market in India include a perceived threat from surrounding countries, the need to update obsolete military hardware and technology, and domestic unrest. As the market looks set to continue growing, original equipment manufacturers are being drawn to India from abroad, while domestic private-sector companies also step up to meet demand.



Statistics of India's Defense Budget, 2010-11 and 2011-12

   2010-11  2011-12
Defense Budget (Rs. in Crore)  1,47,344  1,64,415.49
Growth of Defense Budget (%)  3.98  11.59
Revenue Expenditure (Rs. in Crore)  87,344 95,216.68
Growth of Revenue Expenditure (%)  0.57  9.01
Share of Revenue Expenditure in Defense Budget (%)  59.28  57.91
Capital Expenditure (Rs. in Crore)  60 69,198.81
Growth of Capital Expenditure (%)  9.44  15.33
Share of Capital Expenditure in Defense Budget (%)  40.72  42.09
Share of Defense Budget in GDP (%)  2.12  1.83
Share of Defense Budget in Central Government Expenditure (%)  13.29  13.07

 Source: Institute for Defense Studies & Analyses



Market Outlook


Due to the high cost of specialized materials and intensive technological innovation necessary in the aerospace and defense industry, manufacturers need to bring down costs, boost productivity and cut the time it takes to get products to the market. The industry is becoming increasingly competitive on an international scale and is being hit by economic factors, which see governments trying to cut budgets, including defense spending. Mergers and acquisitions are an attractive option for companies seeking to become more competitive. Collaboration can help partnering companies speed up delivery of innovative products, while keeping the total cost of ownership down.


International legislation regarding arms is a central factor for the aerospace and defense industry, obliged to comply with government regulations. The market is increasingly price sensitive, especially with regard to airlines forced to adapt to an unstable global economic climate. Defense companies are forced to respect fixed-price contracts to satisfy governments looking to cut defense costs to secure long-term contracts. The industry is a heavy consumer of biofuel, seeking to manufacture products while respecting environmental concerns.


The industry also needs to lead in terms of innovation, technology and highly specialized expertise. Production time is an increasingly important factor, and original equipment manufacturers can face extended costs when backlogs run into extra production time. The industry is expected to grow at a rate of between 5% and 6% over the next couple of decades.


Leading Industry Associations




You might be interested in these related markets


Understand the Aerospace & Defense Industry Quickly & Get Actionable Data Easily. The Latest Reports with Statistics & Trends from Top Industry Sources
1-10 of about 27 000 reports

Global Aerospace Market

  • August 2015
    8 pages
  • Satellite  



  • United States  


View report >

Aerospace Industry in the US

  • August 2015
    20 pages
  • United States  

View report >

Aerospace Industry in Europe

  • August 2015
    207 pages
  • Weapon  

    Small Arm  


  • Europe  


View report >

Aerospace Industry in Asia and the US Forecast

  • June 2015
    17 pages
  • Aerospace  


  • Asia  

    United States  


View report >

Defense Industry in China and Japan Forecast

  • July 2015
    24 pages
  • Defense  

  • China  


View report >

Aerospace And Defense Industry in France and Europe Forecast

  • June 2015
    19 pages
  • Aerospace and D  

    Aircraft Manufa  

  • France  


View report >

Aerospace And Defense Industry in Europe and Germany

  • March 2015
    6 pages
  • Aerospace and D  

    Defense Industr  

  • Europe  



View report >

Defense Industry in Libyan Arab Jamahiriya and Italy

  • July 2015
    113 pages
  • Defense Industr  

  • Libyan Arab Jam  



View report >

Defense Demand Analysis in the UK

  • August 2015
    5 pages
  • Defense  

  • United Kingdom  


View report >

The future of the Aerospace Industry in Canada

  • July 2015
    16 pages
  • Aerospace  

  • Canada  

View report >

About 15 000 reports

Purchase Reports From Reputable Market Research Publishers
(From $ 75 - $ 7 500)

Augmented Reality in Cars in North America and the European Union

Augmented Reality in Cars in North America and the European Union

  • $ 7 500
  • Industry report
  • June 2015
  • by Frost & Sullivan

Overall AR-enabled Head-up Displays to Gain 10.4% Market Share by 2025 In an attempt to increase driver safety, OEMs are trying to integrate ADAS content and warnings into head-up displays (HUDs).This ...

Us Dod Helicopter Market 

August 2015 $ 7 000

2015 Global Defense Outlook

July 2015 $ 7 000

Global Military Aircraft Maintenance, Repair, And Overh ...

June 2015 $ 7 000

Us Dod 2016 Budget Assessment

June 2015 $ 7 000

Vulnerability Management (vm)–global Market Analysis ...

July 2015 $ 6 500

 technology Innovations Enabling Manufacturing Of Fuel ...

June 2015 $ 6 500

The Safety-security Argument—expanding Needs In A Con ...

August 2015 $ 6 000

 internet Of Industrial Things: The Vision And The Rea ...

August 2015 $ 6 000

Satellite Transponders Market 

August 2015 $ 6 000

ReportLinker is an award-winning market research solution that finds, filters and organizes the latest industry data so you get all the market research you need - quickly, in one place.