|Study Period:||2018 -2030|
Need a report that reflects how COVID-19 has impacted this market and its growth?
The US defense spending will grow from USD 714 billion in 2020 to about USD 900 billion by 2030. The US Defense Market is poised to witness a CAGR of over 2% during the forecast period 2021 - 2030.
The COVID-19 pandemic impacted the country's economy seriously. It is estimated that the economy is contracting by approximately 3.5%, due to the closing of various businesses like restaurants and airlines. This economic downturn has led to a decrease in the overall military expenditure in 2020 compared to previously planned military spending.
In the United States, military spending has been considered to be the second-largest allocation in the federal budget, after social security. The country's spending on its defense is greater than that of the cumulative defense spending of countries like China, Saudi Arabia, Russia, the United Kingdom, India, France, Japan, Germany, and South Korea. In 2019, the US defense spending was USD 732 billion.
The current ongoing political tensions with China and Russia and planned procurements of advanced military equipment to replace the aging equipment currently in service are expected to accelerate the growth of the market.
Additionally, the fight against terrorism, externally and internally, is also expected to support the growth of the defense market in the United States.
The growing investments in the development of advanced technologies, like additive manufacturing technology for applications like body armor, directed energy weapons, and artificial technologies, among others, to support the armed forces are expected to provide future growth opportunities.
Scope of the Report
The study covers all aspects and provides insights into the budget allocation and spending in the US defense market in the past and the present, along with the forecast for the future. The market includes details about the procurement and modernization plans of the US Armed Forces. Based on Armed Forces, the market is segmented into Army, Navy, and Air Force. Based on Type, the market is segmented into Aircraft, Rotorcraft, Ground Vehicles, Naval Vessels, C4ISR, Weapons and Ammunition, Protection, and Training Equipment. The market also includes investments into the development and launch of satellites and research and development of advanced technologies like directed energy weapons, the use of composites, and advanced manufacturing technologies like 3D printing. The market sizing and forecasts have been provided in value (USD billion).
|Weapons and Ammunition|
|Protection and Training Equipment|
Key Market Trends
The Air Force Segment is Expected to Register the Highest Growth Rate During the Forecast Period
The air force segment is expected to experience major growth in the US defense market during the forecast period, owing to various procurement plans for replacing aging combat aircraft, as well as procurement plans for new unmanned aerial vehicles. In FY 2021, the US Air Force requested USD 47.72 billion for the research and development of new technology. The increase in the amount may lead to funding for the next-generation fighter jets of the US Air Force. For 2021, the United States plans to invest about USD 56.9 billion on modernizing its air domain through 79 F-35 Joint Strike Fighters, 15 KC-46 Tanker Replacements, 24 F/A-18 E/F Super Hornets, 52 AH-64E Attack Helicopters, 5 VH-92 Presidential Helicopters, P-8A Aircraft, 7 CH-53K King Stallion, and 12 F-15EX. The report by the Center for Strategic and Budgetary Assessments (CSBA) by 2018 (which was approved by the US Congress) stated that the US Air Force required 386 operational aircraft. According to the study, there were shortfalls in the tanker, bomber, fighter, strike/reconnaissance drones, and command-and-control/intelligence, surveillance, and reconnaissance inventories. The study further revealed that the Air Force required 14 bomber squadrons, 62 fighter squadrons, 54 tanker squadrons, 27 strikes/reconnaissance drone squadrons, and 62 C2/ISR squadrons by 2030.
The US Air Force increased the use of unmanned aerial systems over the years, as enhancements in advanced navigation and communication technologies and the increase in military communications satellite bandwidth have made remote operations of unmanned aerial systems (UASs) more practical. Unmanned systems provide a sophisticated stand-off capability that supports intelligence, command and control, targeting, weapons delivery, and improve situational awareness of the armed forces. The requested budget for FY2021 included an increase of 31.84% investment into procurement of new UAVs in 2021 compared to 2019. In addition, the US Department of Defense increased the research and development funding for UAVs, as they are inexpensive to produce, and the integration of new technology into their miniaturization has accelerated the development of many UAS types. Thus, upcoming procurements and R&D developments will propel the growth of the segment at a high CAGR during the forecast period.
To understand key trends, Download Sample Report
The US Defense Market is Expected to Experience a Steady Growth in the Next Few Years
In 2019, US military spending grew by 5.3%, reaching USD 732 billion from USD 649 billion in 2018. The United States has the highest military spending in the world, and it accounted for 38% of the total global defense spending in 2019. For 2021, the US defense budget was USD 704.6 billion to improve military readiness and invest in the modernization of armed forces. The DoD (Department of Defense) made investments in hypersonic missile technology and autonomy in military and military electronics, such as sensors, integrated circuits, electronic warfare (EW), and power electronics, among others. The US armed forces currently have a fleet of more than 13,200 military aircraft, 40,000 armed vehicles, and 450 naval vessels in service. In order to enhance its military technologies, the country is investing heavily in the research and development of artificial intelligence (AI). The armed forces are integrating AI for ISR applications, command and control applications, enhancement of autonomy, and improvement of the lethality of weapon stations, among others. Various ongoing developments are expected to lead to growth in the US defense market in the near future.
There are several players in the market that support the defense market of the United States. However, Lockheed Martin Corporation, The Boeing Company, Raytheon Technologies Corporation, General Dynamics Corporation, and Northrop Grumman Corporation are some of the prominent players in the US defense market, which are expected to hold a significant share. Various initiatives and product innovations are done by companies to strengthen their presence in the market. In this regard, as of November 2020, FLIR Systems Inc. received multiple contracts worth over USD 100 million under the Army’s Man Transportable Robotic System Increment II (MTRS Inc II) program to deliver more than 750 of the company’s Centaur unmanned ground vehicles (UGVs) to the United States Air Force, Marine Corps, Army, and Navy to support disarming of improvised explosive devices, unexploded ordnance, and similar hazardous tasks. The provision of long-term contracts for the development of new military equipment and technologies is anticipated to propel the revenues of various companies in the United States. For instance, in October 2020, Palantir Technologies Inc. was awarded a USD 91.2 million two-year contract from the US Army Research Laboratory for research and development of artificial intelligence and machine learning capabilities. Such partnerships are expected to help the companies increase their share in the market.
In December 2020, Oshkosh Defense LLC was awarded a contract worth USD 911 million by the US Army Contracting Command, Detroit Arsenal, to deliver 2,738 Joint Light Tactical Vehicles (JLTV), 1,001 companion trailers, and associated kits. The JLTVs are planned to be supplied to the US Air Force, US Army, US Marine Corps, and US Navy, along with a select group of NATO and non-NATO allies.
In July 2020, the US Air Force awarded Boeing approximately USD 1.2 billion contracts to design, develop, and construct eight F-15EX advanced fighter jets. Under the contract, the first two aircraft are scheduled to be delivered by the end of 2021. The Air Force also announced an overall Indefinite Delivery Indefinite Quantity contract for F-15EX with a ceiling value of about USD 23 billion.
In April 2020, the US Navy selected Fincantieri for the design and construction of a new class of guided-missile frigates based on its FFG(X) design on the FREMM multi-mission frigate. The contract is worth USD 795 million under the budget of Fiscal Year 2020. The contract also includes an option for nine more ships, which will increase the total value of the contract to USD 5.58 billion (if all options are exercised).
Table of Contents
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 US Defense Import and Export
5. MARKET SEGMENTATION (Market Size by Value - USD billion)
5.1 Armed Force
5.1.3 Air Force
5.2.3 Ground Vehicles
5.2.4 Naval Vessels
5.2.6 Weapons and Ammunition
5.2.7 Protection and Training Equipment
6. COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.2 Company Profiles
6.2.1 Lockheed Martin Corporation
6.2.2 The Boeing Company
6.2.3 Raytheon Technologies Corporation
6.2.4 General Dynamics Corporation
6.2.5 Northrop Grumman Corporation
6.2.6 L3Harris Technologies Inc.
6.2.7 BAE Systems PLC
6.2.8 CACI International Inc.
6.2.9 Textron Inc.
6.2.10 Elbit Systems Ltd
6.2.11 Huntington Ingalls Industries Inc.
6.2.12 Kongsberg Gruppen ASA
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
You can also purchase parts of this report. Do you want to check out a section wise price list?
Frequently Asked Questions
What is the study period of this market?
The United States Defense Market market is studied from 2018 - 2030.
What is the growth rate of United States Defense Market?
The United States Defense Market is growing at a CAGR of >2% over the next 5 years.
What is United States Defense Market size in 2018?
The United States Defense Market is valued at 714 Billion USD in 2018.
What is United States Defense Market size in 2030?
The United States Defense Market is valued at 903 Billion USD in 2030.
Who are the key players in United States Defense Market?
Lockheed Martin Corporation, The Boeing Company, General Dynamics Corporation, Northrop Grumman Corporation, Raytheon Technologies Corporation are the major companies operating in United States Defense Market.