Turkey Aerospace And Defense Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Turkey Aerospace And Defense Market Trends and Insights

Rising Defense-Budget Allocations

The 2025 defense budget of USD 47 billion allocates 165 billion Turkish lira to the Defense Industry Support Fund, guaranteeing near-term demand for indigenous air and missile programs and underwriting USD 4.5 billion in domestic R&D. Elevated outlays have already accelerated serial production of the Hisar-O air-defense missile and enabled new engine test stands for the TF35000 turbofan, thereby deepening vertical integration across propulsion, guidance and C4ISR subsystems. Predictable funding streams also entice SMEs into advanced composites, sensors, and additive-manufacturing niches, expanding the supplier base that feeds the Turkish aerospace and defense market. Taken together, these investments reinforce Turkey’s quest for strategic autonomy and broaden its export appeal to partners eager for technology transfer.

Surge in UAV and Guided-Munition Exports

Baykar’s USD 1.76 billion 2024 revenues highlight how performance in Ukraine, Libya, and Nagorno-Karabakh translated into contracts across 34 countries, with locally staffed facilities inaugurated in Ukraine and Indonesia. The TB3’s deck-based sorties from TCG Anadolu illustrate maritime force-multiplication at price points light-carrier navies can afford. Accompanying precision munitions packages and sustainment services create stable annuity revenues, helping firms weather exchange-rate swings while enlarging the Turkish aerospace and defense market footprint. 

National Self-Reliance and Indigenous-Platform Targets

The KAAN fighter’s USD 10 billion export contract with Indonesia for over 48 aircraft—with licensed production lines in Bandung—confirms that home-grown designs can win on global tenders even against established Western jets. Turkey reduced foreign dependency from 80% to 20% in two decades, building supply-chain depth in avionics, warheads, and composite structures. Indigenous-content mandates channel procurement toward local suppliers, locking in scale economies that lower unit costs and make Turkish bids more competitive abroad. Once perceived as risks, technology-transfer clauses now function as selling points for governments seeking industrial upskilling, enlarging the Turkish aerospace and defense market.

Commercial-Aviation Fleet and Airport Capacity Expansion

Turkish Airlines operates 458 aircraft and targets 813 by 2033, a plan that requires expanded MRO capacity, domestic interiors, and composite components.^{[2]Source: Turkish Airlines, “Board Activity Report 2Q 2024,” investor.turkishairlines.com} Istanbul Airport’s 120 million-passenger layout cements Turkey’s role as an intercontinental hub, sparking demand for radar, baggage handling, and ground-support systems. Dual-use technologies migrate from military programs into cost-sensitive commercial lines—such as additive-manufactured cabin brackets—shortening development cycles. Thus, the Turkish aerospace and defense market benefits from civil-military technology convergence that diversifies revenue streams.

Currency Volatility and High Input-Cost Inflation

Sharp Turkish-lira swings widen cost baselines for imported engines and aerospace-grade titanium, complicating pricing for long-cycle export contracts. Although 80% of a finished system is now locally sourced, the 20% foreign-supplied share often embodies propulsion or sensor packages that carry disproportionate value. Hard-currency billing and natural-hedge export portfolios provide partial relief, yet material inflation still pressures margins across the Turkish aerospace and defense market.

Export-License/Sanctions Exposure

Western sanctions following the S-400 acquisition evicted Turkey from the F-35 program, blocking planned workshare returns on a USD 1.4 billion sunk cost. License denials for US-origin components complicate subsystem sourcing and restrict sales into NATO markets. Turkish response strategies range from indigenous engine development to supply-chain diversification toward Asian and Middle-Eastern vendors, a pathway that expands design freedom but requires additional qualification testing. Short-term friction thus trims growth in the Turkish aerospace and defense market, even as self-reliance programs lay foundations for long-term resilience.

Segment Analysis

By Industry: Manufacturing Drives Indigenous Platform Development

Manufacturing, design, and engineering (MDE) generated 59.87% of 2024 revenue and is on track for a 3.06% CAGR, underscoring how production autonomy underpins the Turkish aerospace and defense market. TUSAŞ’s 4 million m² Kahramankazan campus covers design, assembly, and flight-test operations, enabling simultaneous production of the KAAN fighter, GÖKBEY helicopter, and ANKA-3 UAV on contiguous lines.^{[3]Source: TUSAŞ, “Corporate Facilities,” tusas.com} Serial-production capacity gives Turkish primes negotiating clout on joint-venture bids, while SMEs supply harnesses, 3D-printed ducts, and high-temperature resins, elevating domestic value capture to 80% across major platforms.

The segment’s forward momentum benefits from additive manufacturing breakthroughs that shorten tooling cycles by 40%, allowing for quick pivoting from prototype to low-rate initial production. Integrated digital twins reduce rework costs and align well with export partners’ offset packages, enhancing the appeal of the Turkish aerospace and defense market. Sustained investment in hybrid composite-metallic structures for the TF35000 engine nacelle highlights how Turkey converts R&D budgets into proprietary IP that commands premium margins.

Note: Segment shares of all individual segments available upon report purchase

By Type: Defense Platforms Lead While Aerospace Accelerates

Defense platforms accounted for 68.60% of 2024 revenue as the Turkish Armed Forces recapitalized its armored vehicles, air-defense battalions, and naval assets. Combat-tested systems enhance credibility abroad, driving 30% year-over-year export growth that expands the Turkish aerospace and defense market. Yet the Aerospace segment’s 3.35% CAGR is closing the gap, powered by Turkish Airlines’ fleet-doubling plan and the domestic space program’s demand for launch structures and satellite buses.

Turksat 6A, designed in Ankara, extends coverage to 5 billion people and unlocks telecom royalties from emerging Asian markets. Civil-military spillovers, such as space-qualified solar arrays now repurposed for HALE UAVs, illustrate technology cross-pollination that enriches the Turkish aerospace and defense industry while reducing dependence on volatile defense cycles.

By End User: Military Dominance With Government Growth Emerging

Military agencies purchased 72.45% of the 2024 output, absorbing large volumes of precision munitions, tactical UAVs, and naval corvettes under multi-year procurement plans. National forces act as launch customers, validating systems for foreign buyers and cementing robust baseline demand for the Turkish aerospace and defense market. Nonetheless, Government (non-military) applications show a 3.78% CAGR, driven by border security towers, wildfire-monitoring drones, and satellite-enabled e-government connectivity.

Civil-authority adoption of dual-use radars and encrypted radio networks helps amortize R&D across broader volumes, lowering unit costs and improving export competitiveness. Such diversification shields revenue streams against potential slowdowns in defense allocation without diluting core competencies that define the Turkish aerospace and defense market.

By Platform: UAVs Lead Innovation and Export Success

UAVs accounted for 26.57% revenue and paced the field with 4.60% CAGR, reflecting Baykar’s prominent share of global UAV exports and TB2’s milestone of 1 million flight hours. Indigenous EO/IR turrets, SATCOM data links, and smart munitions replace once-imported payloads, keeping value in-country and expanding the Turkish aerospace and defense market. Fixed-wing manned projects such as the KAAN fighter diversify the portfolio, while ATAK-II heavy helicopter programs address regional rotor-craft demand.

Missile and precision-munition lines leverage composite airframes from drone production, cutting cycle times and offering turnkey packages attractive to medium-income nations. Space platforms, catalyzed by Fergani Space’s private-satellite launch, present long-tail upside by positioning Turkey as a regional provider of earth-observation and PNT services. Platform diversity, therefore, undergirds the sustained expansion of the Turkish aerospace and defense market.

Geography Analysis

The Marmara region houses SAHA Istanbul, a 1,300-member cluster that tallied USD 12.59 billion turnover and USD 6.08 billion exports in 2024. Its concentration of system integrators, port logistics, and the new Istanbul Airport places it at the epicenter of the Turkish aerospace and defense market. Collaborative R&D parks link primes with prototyping boutiques, accelerating the transition from concept to series production and enabling quick iterations responding to export customer feedback.

Central Anatolia, anchored by Ankara, centers on Turkish Aerospace’s Kahramankazan plant and the TF35000 engine integration line, reinforcing propulsion self-reliance. Proximity to defense-procurement agencies fosters agile decision-making and rapid contract execution, factors that cultivate new entrants and sustain SME pipelines feeding the Turkish aerospace and defense market.

The Aegean region leverages Izmir’s industrial zones and deep-water ports to support naval-air integration projects, while Mediterranean shipyards diversify into UAV-capable corvette decks. Black Sea hubs focus on radar and EW subsystems, capitalizing on offshore gas security needs. Southeastern and Eastern Anatolia offer cost-competitive facilities and tax incentives, attracting additive-manufacturing startups and broadening geographic risk dispersion for the Turkish aerospace and defense market.