Air Traffic Control Equipment Manufacturing in the US Industry Market Research Report Now Available from IBISWorld

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The Air Traffic Control Equipment Manufacturing industry has smoothly gained altitude over the past five years. Though the recession reduced demand for air travel across the economy, stable government contracts allowed air traffic control (ATC) equipment manufacturers to weather the downturn. Heavy technological change characterizes the industry; the government's NextGen program, which aims to completely transform the US ATC system from radar-based to satellite-based by 2025, will drive demand for manufacturers over the next five years. For these reasons, industry research firm IBISWorld has added a report on the Air Traffic Control Equipment Manufacturing industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

The recession caused customers to defer replacements, but recovery was swift

Over the five years to 2012, the Air Traffic Control (ATC) Equipment Manufacturing industry is expected to grow at an annualized rate of 4.2% to $1.6 billion. ATC equipment is used primarily by air traffic controllers at airports. Thus, demand for newly manufactured ATC equipment diminished during the recession as airlines and airports faced weak demand for commercial flights and airfreight. According to IBISWorld industry analyst Antonio Danova, “Less air traffic eliminated the need to update or replace existing ATC equipment, and many ATC service companies deferred replacement.” Still, ATC equipment manufacturers evaded massive losses, despite a 3.3% decline in 2009, largely because of strong, longstanding contracts with the government.

ATC equipment manufacturers rely heavily on funding from the Federal Aviation Administration (FAA) for research and develop expenditure in an industry with an ever-changing technology climate. When the economy crashed, the government passed the American Recovery and Reinvestment Act (ARRA) to protect some of the country's key industries. The FAA was dealt a significant portion of the act's budget, with “about $100 million in funds dedicated solely to revamping ATC towers and navigational equipment,” says Danova. This government support helped return the industry to growth. With an improving economic climate, higher airline traffic and enduring government support, IBISWorld expects the industry to grow in 2012. This growth will be spread across a industry with low concentration; the three major companies in the Air Traffic Control Equipment Manufacturing industries – Harris Corporation, BAE Systems PLC and General Dynamics Corporation – account for less than half of the industry’s total revenue.

The future remains bright for ATC equipment manufacturers, with revenue projected to grow over the five years to 2017. Industry firms will be gearing up for the FAA's Next Generation Air Transportation System (NextGen), a proposed overhaul of the entire US air traffic control system that will take place gradually through 2025. NextGen is designed to increase flight efficiency and make the airways safer as commercial, freight and military air traffic increases. As such, the need for new technologies in ATC equipment to meet NextGen goals will spur sales at the manufacturing level, benefiting industry firms. Moreover, higher technical manufacturing will facilitate continued implementation of automated processes at production plants. This trend will cause some consolidation of peripheral labor, as firms look to keep their most skilled engineers, programmers and product developers. Average industry profit margins are expected to grow as firms keep operations efficient and as new technologies spur increased activity. For more information, visit IBISWorld’s Air Traffic Control Equipment Manufacturing report in the US industry page.

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IBISWorld industry Report Key Topics

This industry manufactures air traffic control (ATC) and communications equipment. ATC equipment is used by air traffic control officers primarily at airports and other air transportation hubs to make air traffic efficient and to provide information and support to aircraft pilots.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith
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