Precision Guided Munition Market Poised for Robust Growth Due to Increasing Defense Budget Allocations
Precision guided munitions (PGMs) are autonomous or semi-autonomous weapon delivery systems that can effectively reach their targets and neutralize them with high precision. PGMs employ an integrated guidance system to maneuver the ammunition to the target mid-flight. Major applications of PGMs include air-to-surface missiles, surface-to-air missiles, anti-ship missiles, and air-to-underwater munitions.
The global precision guided munition Market is estimated to be valued at US$35.2 Bn in 2024 and is expected to exhibit a CAGR of 7.1% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Precision Guided Munition Market is Estimated to Witness High Growth Owing to Increasing Defense Budget Allocations
One of the major drivers for the growth of the precision guided munition market is the increasing defense budget allocations by different economies globally. Various countries are investing heavily in strengthening their defense systems and adopting high-precision weaponry. According to the Stockholm International Peace Research Institute (SIPRI), the global defense expenditure rose to $2.1 trillion in 2021, registering an increase of 0.7% from 2020. The growing geopolitical instabilities and territorial disputes are fueling the demand for technologically advanced guided munitions for enhanced defense capabilities.
Additionally, ongoing modernization of aging weapon systems coupled with rising adoption of autonomous capabilities by defense forces is also augmenting the market growth. For instance, both US and China have included development of hypersonic weapons in their defense modernization plans. The advantages of precision, minimal collateral damage, and increased operational effectiveness are boosting the deployment of PGMs.
Key players
Key players operating in the Precision Guided Munition market are Lockheed Martin Corporation, BAE Systems, Raytheon Technologies, Northrop Grumman Corporation, General Dynamics Corporation, Boeing, L3Harris Technologies, Thales Group. These companies have strong capabilities across the weapons value chain from research & development to production. They are focused on portfolio expansion and cooperation with smaller firms to tap new opportunities.
Key players operating in the Precision Guided Munition market are Lockheed Martin Corporation, BAE Systems, Raytheon Technologies, Northrop Grumman Corporation, General Dynamics Corporation, Boeing, L3Harris Technologies, Thales Group. These companies have strong capabilities across the weapons value chain from research & development to production. They are focused on portfolio expansion and cooperation with smaller firms to tap new opportunities.
SWOT Analysis
Strength: Precision guided munitions have high accuracy which allows for reduced collateral damage. Their ability to change trajectory mid-flight enables effective targeting of moving assets. Integration of advanced sensors and guidance systems in these weapons ensure three sentence long explanation of strength.
Weakness: High production costs associated with precision components and technologies used in these munitions. Dependence on advanced technologies from other nations increases import dependence. Occasional errors in sensor or guidance systems may reduce accuracy, requiring two sentence explanation of weakness.
Opportunity: Growing defense budgets of developing economies wanting to modernize their arsenals. Increasing instances of asymmetric warfare and urban combat scenarios presenting new tactical requirements for precision weapons. Opportunity of diversifying defense manufacturing capabilities through co-production/licensed production deals.
Threats: Proliferation concerns over dual-use technologies restrict export of critical components. Emergence of low-cost counter technologies like loitering munitions poses a threat. Rising geopolitical tensions increasing chances of export sanctions or interruptions.
Key Takeaways
The global precision guided munition Market is expected to witness high growth over the forecast period of 2024 to 2031. The global Precision Guided Munition Market is estimated to be valued at US$ 21.8 billion in 2024 and is expected to exhibit a CAGR of 7.1% over the forecast period 2024 to 2031.
The North America region currently dominates the precision guided munition market with the US being the largest developer and exporter of these systems. Significant defense modernization initiatives and ongoing military operations have driven demand. However, the Asia Pacific region is expected to witness the fastest growth on account of rising defense budgets and procurement programs in China, India, South Korea and other countries looking to narrow the capability gap with their western counterparts.
