The Precision Guided Munition Market Is Estimated To Witness High Growth Owing To Increasing Demand For Precision Based Targeting
The Precision Guided Munition Market is estimated to be valued at Us$ 35.85 Bn in 2023 and is expected to exhibit a CAGR Of 7.1% over the forecast period 2023 To 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
The precision guided munitions market comprises of guided bombs, missiles, rockets and others that can be directed toward targets with precision using sensors and other technologies. These weapons are equipped with inertial guidance systems, laser guidance systems and GPS or global navigation satellite system for accurate navigation. Precisions munitions enhance military capabilities by reducing risks to civilians, minimizing collateral damage and offering engagement flexibility.
Market key trends:
Increasing demand for precision based targeting from militaries around the world to minimize collateral damage during military operations is a key trend driving the precision guided munitions market growth. Precision munitions increase lethality while reducing civilian casualties significantly by hitting intended targets accurately. Additionally, growing geopolitical tensions and rising military budgets of developing economies are fueling investments in advanced weaponry. Technological advancements like integration of artificial intelligence, hypersonic speeds and improved propulsion systems are also expanding application areas of precision guided munitions. Development of low cost precision systems and upgrades of legacy weapons with precision capabilities further support market expansion over the forecast period.
Porter's Analysis
Threat of new entrants: The precision guided munition market requires massive R&D investments and established distribution networks. This poses high barriers for new companies.
Bargaining power of buyers: Large defense organizations have significant bargaining power over manufacturers due to their bulk buying capacity and ability to choose between global suppliers.
Bargaining power of suppliers: Key raw material and component suppliers have some bargaining power due to their technical expertise and intellectual property. However, presence of multiple suppliers mitigates the threat.
Threat of new substitutes: There are no cost-effective substitutes for precision guided munitions currently.
Competitive rivalry: The market is moderately competitive with the presence of major global players and frequent mergers & acquisitions.
SWOT Analysis
Strengths: Advanced technologies such as Artificial Intelligence, miniaturization and connectivity allow precision targeting with minimal collateral damage.
Weaknesses: High costs associated with R&D, production, and maintenance. Political and economic instability can affect defense budgets.
Opportunities: Increasing defense expenditures in developing countries. Growing demand for smart weapons. Emergence of hybrid warfare accelerates requirement.
Threats: Geopolitical risks and stringent export regulations. Rising costs due to inflation, raw material shortages and supply chain disruptions.
Key Takeaways
The Global Precision Guided Munition Market Demand is expected to witness high growth at a CAGR of 7.1% over the forecast period, due to increasing spending on advanced weapons systems by major economies. The market size for precision guided munitions was valued at US$ 35.85 Bn in 2023 and is expected to reach US$ 63.30 Bn by 2030.
North America dominates the precision guided munitions market currently, with the US being the largest exporter of these systems. However, the Asia Pacific region is expected to be the fastest growing market, driven by the increasing Defense budgets of China and India along with their ongoing modernization programs.
Key players operating in the precision guided munition market are Lockheed Martin Corporation, Northrop Grumman Corporation, Raytheon Technologies Corporation, General Dynamics Corporation, BAE Systems, Rheinmetall AG, SAAB, Elbit Systems Ltd, MBDA, and Israel Aerospace Industries. Major players are focusing on development of new hypersonic and AI-based precision weapons through partnerships and collaborations.