Market Snapshot
| Study Period: | 2018 - 2026 |
| Base Year: | 2020 |
| Fastest Growing Market: | North America |
| Largest Market: | North America |
| CAGR: | >7 % |
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Market Overview
The aerostat systems market is estimated to register a CAGR of more than 7% during the forecast period (2021 - 2026).
The GDP witnessed a decline by more than 4% in 2020 due to the economic impacts of the COVID-19 pandemic. However, according to the Stockholm International Peace Research Institute (SIPRI), global military spending increased by 2.6% to reach USD 1981 billion in 2020. Nevertheless, defense spending might come down in the near future due to the global economic crisis that is triggered by the pandemic. This factor is expected to challenge the growth of the aerostat systems market during the forecast period.
Factors like growing terrorism, increasing territorial tensions, and border infiltrations around the world are propelling the militaries to enhance their battlefield data-sharing capabilities. Though UAVs are becoming popular for ISR missions, UAVs cannot offer continuous wide-area surveillance for several days continuously. This has resulted in several countries adopting aerostats as an alternative. Aerostat systems can operate 24/7 for weeks or even months at a time, offering persistent surveillance.
Other than military applications, aerostats are becoming popular for environmental research and commercial applications, like internet connectivity. Aerostats are now being used to expand LTE networks and 5G technology in remote areas at a significantly low cost and energy.
However, the aerostat systems market faces certain challenges and limitations with respect to operational altitude and survivability in adverse weather conditions. These limitations are expected to challenge the growth of the market during the forecast period.
Scope of the Report
Aerostats are lighter than air aircraft that gain lift using buoyant gas. Aerostats can be free-flying or tethered. The aerostat systems market is segmented by application into military and law enforcement and commercial and research. The report also offers the market sizes and forecasts for the aerostat systems market across the major regions in the world. For each segment, the market sizes and forecasts are represented by value (USD billion).
| Application | |
| Military and Law Enforcement | |
| Commercial and Research |
| Geography | |
| North America | |
| Europe | |
| Asia-Pacific | |
| Rest of the World |
Key Market Trends
Military and Law Enforcement Segment Held the Largest Market Share in 2020
The military and law enforcement segment accounted for a major share of the market in 2020. This is primarily due to increased demand for aerostat systems to support intelligence, surveillance, and reconnaissance missions and enhance network communications capabilities in land and sea platforms. Ground-based and shipboard aerostats are effective and affordable systems that offer continuous, wide-area surveillance and timely provision of target information. They can be used for applications including early intrusion alert, illegal immigration monitoring, anti-terrorism, fishing activity surveillance, and smuggling deterrence. Several military and law enforcement end users are considering acquiring various monitoring options in the coming years. Aerostat systems are expected to be one of the viable options for procurement due to their advantage to obtain highly accurate and real-time surveillance data at a remarkably low total cost of ownership. Also, the ease of integrating advanced ISR payloads, such as electro-optical/infrared cameras, radar, and communications relays, is expected to support their procurement plans. In 2019, the European Border and Coast Guard Agency (Frontex) collaborated with the Hellenic Coast Guard and carried out successful tests that proved aerostats could be used for maritime border surveillance effectively. Following this, in 2020, FRONTEX announced that they would be launching another pilot program to assess the capacity and cost efficiency of aerostat platforms for maritime surveillance and modify and optimize the equipment used. Such programs are expected to bolster the prospects of the military and law enforcement segment in the years to come.
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North America is Expected to Dominate the Market During the Forecast Period
North America held the largest market share in 2020, and the region is also expected to exhibit the highest growth rate during the forecast period. The United States is the largest market for aerostat systems in the world and is also investing heavily in aerostat systems for communication and surveillance purpose. In February 2020, Peraton received a USD 277.5 million contract for Tethered Aerostat Radar Systems (TARS) from the US Department of Homeland Security for low-range border and maritime surveillance operations. Likewise, Raven Industries also received a USD 10.4 million contract in 2019 for its TIF-25K aerostat systems to be deployed in Afghanistan. However, the recent decision by the US Customs and Border Protection to end the seven-year-old surveillance blimp program is expected to hinder the market growth in the country. In the commercial and the research segment, many aerostat manufacturers in the United States are collaborating with telecommunication service providers to provide enhanced telecommunication network quality to users. In February 2019, Altaeros launched the world's first aerial cell tower SuperTower ST200 to provide enhanced 4G LTE networks. In the United States, aerostat systems will also find application in urban drone tracking operations to provide protection to high-value assets. On the other hand, the ongoing pilot programs that aim to test the usefulness of aerostats in various missions are expected to drive the market. In October 2019, DARPA announced that it would be testing the drone tracking technology using sensor-based aerostats. Such developments are expected to propel the growth of the aerostat market in North America during the forecast period.
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Competitive Landscape
The aerostat systems market is moderately consolidated, as few major players occupy a major share in the market. Some of the prominent players in the market are Lockheed Martin Corporation, TCOM LP, Raven Industries, Israel Aerospace Industries Limited, and RT LTA Systems Ltd, among others. Aerostat systems have an immense potential for commercial application, especially in the communication category. Hence, the partnerships of aerostat manufacturers with various commercial operators are expected to increase their sales and enhance their geographical footprint in the world. On the other hand, aerostat systems manufacturers are enhancing the capabilities of their existing aerostats with the integration of advanced sensors. Technologies like unmanned aerostats are expected to define the future of the aerostats industry, and players are expected to incorporate such technologies in their future products. This is also anticipated to help the companies acquire contracts from new customers and further increase their share in the market.
Recent Developments
In February 2021, Rheinmetall Canada announced that it had secured a sustainment contract to continue providing maintenance services for the Persistent Surveillance System (PSS) units used by the Canadian Armed Forces. The one-year contract includes the necessary repair and overhaul services for eight PSS units that are currently in use.
In October 2020, Altaeros announced the launch of its new ST-Flex autonomous aerostat, which is a portable, rapidly deployable SuperTower designed to simplify and accelerate network deployments for industrial IoT, disaster response, rural connectivity, and many other data-intensive applications.
In September 2019, TCOM LP announced that it was awarded a USD 979 million hybrid (cost-no-fee, cost-plus-fixed-fee, and firm-fixed-price) contract to perform engineering and logistics operations and program management support for the Persistent Surveillance Systems – Tethered (PSS-T) Program. The contract had an estimated completion date of June 2024.
Table of Contents
1. INTRODUCTION
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Porter's Five Forces Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION (Market Size by Value - USD billion)
5.1 Application
5.1.1 Military and Law Enforcement
5.1.2 Commercial and Research
5.2 Geography
5.2.1 North America
5.2.2 Europe
5.2.3 Asia-Pacific
5.2.4 Rest of the World
6. COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.2 Company Profiles
6.2.1 TCOM LP
6.2.2 Raven Aerostar
6.2.3 Lockheed
6.2.4 Worldwide Aeros Corp.
6.2.5 Israel Aerospace Industries Limited
6.2.6 Allsopp Helikites Limited
6.2.7 ILC Dover LP
6.2.8 RosAeroSystems
6.2.9 Lindstrand Technologies Limited
6.2.10 Airborne Industries
6.2.11 RT LTA Systems Ltd
6.2.12 Otonom Technology
6.2.13 Rheinmetall AG
6.2.14 Altaeros
6.2.15 CNIM
6.2.16 Skydoc Systems Inc.
6.2.17 Carolina Unmanned Vehicles Inc.
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
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Frequently Asked Questions
What is the study period of this market?
The Aerostat Systems Market market is studied from 2018 - 2026.
What is the growth rate of Aerostat Systems Market?
The Aerostat Systems Market is growing at a CAGR of >7% over the next 5 years.
Which region has highest growth rate in Aerostat Systems Market?
North America is growing at the highest CAGR over 2021- 2026.
Which region has largest share in Aerostat Systems Market?
North America holds highest share in 2020.
Who are the key players in Aerostat Systems Market?
Lockheed Martin Corporation, Raven Industries Inc., Israel Aerospace Industries Limited, TCOM, L.P., RT LTA Systems Ltd. are the major companies operating in Aerostat Systems Market.
