March 1, 2011 Source: Teal Group
WASHINGTON --- Unmanned Aerial Vehicles (UAVs) have been the most dynamic growth sector of the world aerospace industry this decade, report Teal analysts in their latest integrated market analysis.
Teal Group's 2011 market study estimates that UAV spending will almost double over the next decade from current worldwide UAV expenditures of $5.9 billion annually to $11.3 billion, totaling just over $94 billion in the next ten years.
"The UAV market will continue to be strong despite cuts in defense spending," said Philip Finnegan, Teal Group's director of corporate analysis and an author of the study. "UAVs have proved their value in Iraq and Afghanistan and will be a high priority for militaries in the United States and worldwide."
The study suggests that the US will account for 77% of the worldwide RDT&E spending on UAV technology over the next decade, and about 69% of the procurement. "We expect that the sales of UAVs will follow recent patterns of high-tech arms procurement worldwide, with the Asia-Pacific representing the second largest market, followed very closely by Europe," said Teal Group senior analyst Steve Zaloga, another author of the 458-page study. "Africa and Latin America are expected to continue to be very modest markets for UAVs."
The eighth edition of the sector study, World Unmanned Aerial Vehicle Systems, Market Profile and Forecast 2011, examines the worldwide requirements for UAVs, including UAV payloads and companies, and provides ten-year forecasts by country, region, and classes of UAVs.
Teal Group analysts already cover the UAV market in their World Missiles and UAV Briefing, which examines the UAV market on a program-by-program basis. The sector study examines the UAV market from a complementary perspective, namely national requirements, and includes both a comprehensive analysis of UAV system payloads and key UAV manufacturers.
The 2011 study provides 10-year funding and production forecasts for a wide range of UAV payloads, including Electro-Optic/Infrared Sensors (EO/IR), Synthetic Aperture Radars (SARs), SIGINT and EW Systems, C4I Systems, and CBRN Sensors, worth $2.6 billion in Fiscal Year 2011 and forecast to increase to $5.6 billion in Fiscal Year 2020. The UAV electronics market will grow steadily, with especially fast growth and opportunities continuing in SAR and SIGINT/EW, according to Dr. David Rockwell, third author of the new study.
"The payload portion of the 2011 study includes many new systems and system types, with expanded coverage of SIGINT/EW and SAR markets," said Rockwell "Few now question the U.S. Air Force's claim that ISR is 'the centerpiece of our global war on terrorism, with production beginning for major endurance UAV systems such as MP-RTIP and ASIP,' new RDT&E programs such as wide angle EO/IR systems, and a variety of ground and foliage-penetrating radars, and future development efforts to bring large-aircraft capabilities to small UAVs; tactical and mini/micro/nano-UAVs will continue to offer some of the best electronics opportunities over the next decade."
The study also includes a UAV Manufacturers Market Overview that reflects the worldwide UAV market "continuing as one of the prime areas of growth for defense and aerospace companies," said Finnegan. The new study reflects the rapid growth of interest in the UAV business by increasing the number of companies covered to some 35 US, European and Israeli companies, and reveals the fundamental reshaping of the industrial environment.
"Smaller companies can successfully compete against larger players, as AAI Corp., Insitu, General Atomics and AeroVironment have all shown," Finnegan said. "Now the prime contractors are buying the successful smaller companies." In the past year, L-3 Communications bought Airborne Technologies, a small UAV developer and manufacturer, and VT Group purchased Evergreen's UAV fee-for-service operations.
As prime contractors and small companies compete in the dynamic UAV market, they are adopting widely different strategies. "Our overview tracks the widely varying approaches being taken by these key companies, ranging from outright acquisitions to teaming arrangements and internal development of new UAV systems," said Finnegan.
The Teal Group is an aerospace and defense market analysis firm based in Fairfax, Virginia USA. It provides competitive intelligence to industry and government worldwide.