The defense world is currently witnessing a general infusion of investments as many countries upgrade their programs and technologies. Across the world, military organizations want to ensure that they are capitalizing on the latest technology. For example, in two industry research reports--Global Military Satellite Market 2014-2024 and Global Military Aviation MRO Market 2014-2024--Market Reports details the growth expected in each of these markets.
The global satellite market is expected to experience growth of 3.7% from 2014 to 2024. Communications satellites will dominate the market with a 51.6% share. The demand for these satellites in the U.S. will support this market. In addition, commercial satellites will play a role, as militaries continue to rely heavily upon them for bandwidth needs.
Globally, the Asia-Pacific region will account for 14.8% market share over the forecast period. Europe and Africa both expect growth between now and 2024, with Europe slated for at a CAGR of 4.5%. Although Latin America will see a slight decline in the satellite market, Brazil is predicted to be the highest spender in that region. Yet the Middle East will be the biggest spender, as it invests heavily in the intelligence, surveillance, and reconnaissance (ISR) segment.
Like the military satellite market, the global military aviation MRO market also is expected to grow at a CAGR of 3.4% through 2024. North America will boast the largest aviation MRO market, with the Asia-Pacific region having the second-largest. Together, North America and the Asia-Pacific region will hold a cumulative market share of more than 75%.
Some types of MROs will have larger market shares than others. The multi-role aircraft MRO segment, for instance, is expected to dominate the market in the near term with a share of 43.4%. Yet that market share is expected to decrease throughout the forecast period. The second-largest segment in this sector is transport and other aircraft MRO. Rotorcraft MRO accounts for the third-largest segment. Despite all of the excitement around the potential of unmanned aerial vehicles, UAV MRO is forecasted to only have a CAGR of 4.6% between 2014 and 2024.
The report, Global Military Aviation MRO Market 2014-2024, notes that outsourcing can drive growth for leading defense spending nations. Additionally, procurement and modernization as well as force-readiness initiatives boost growth by attracting investment. Defense budget cuts will push more funding to that sector. In terms of weaknesses, long cycle times can lead to reduced military equipment inventories. Performance-based contracts also can inhibit profitability, while the increase in MRO costs can prevent nations from spending more than critically required.
The report also notes that the pooling of defense resources can create more opportunity for MRO suppliers. MRO opportunities also can be gained by increasing the average age of aircraft. Overall, the greatest threat to this sector lies with the US and European economic crisis and the large amount of MRO workload that is brought under the influence of government depots in the US. Although the weaknesses and threats to the global military aviation MRO market are real, the outlook remains positive. Both the global military satellite and military aviation MRO markets will see steady growth between now and 2024.