Aerospace and Defense Industry: A Global Strategic Business Report
San Jose, CA (PRWEB) March 08, 2012
Follow GIA on LinkedIn – Following the challenges thrown up by the 2007-2009 recession, the post recession environment in the world as stated by the new market research report on aerospace and defense industry is fraught with a new set of threats and challenges. Given that growth in the industry hinges critically on the spending outlook of governments worldwide, Europe’s debt crisis is casting a long shadow of worry over the industry. The financial and political leaders’ attempts to ease out and contain the European government’s debt crisis has yielded inconclusive results to date and this coupled with the growing debate over widening government deficits and need for spending cuts, is likely to result in possible shrinkage in defense budgets in the US and Europe. With the congressional “super committee” established to forge deficit reduction solutions for over $1.0 trillion in spending cuts in the United States, the world’s single largest market for aerospace and defense, defense outlays in the country is ridden with uncertainty. The success of the debt-ceiling deal could trigger across-the-board spending cuts with a major portion of the cuts coming from the Pentagon budget. Against this backdrop, supplementary defense spending in the country is mostly likely to be pruned down than core spending. Although the role played by the US military in Libya as part of the NATO-led coalition, together with its other undercover anti-terrorism military operations in other countries adds to the government’s defense expenditure, the overall prevailing picture is that of austerity as reflected by the US government’s decision to gradually pull out of Iraq and Afghanistan.
Europe represents America’s largest trade and business partner, and the continued recovery in the US economy is therefore dependent in part on the health of the European economy. Also, US banks maintain large number of financial transactions with companies in the Eurozone. Given the level of exposure to Eurozone banks, the European debt crisis therefore exposes US banks to significant risks. While uncertainties plague the developed countries, its opportunities galore for the Asia-Pacific and Middle East markets, as governments in these countries continue to invest heavily in airline infrastructure, and in national security. Increase in the number of airport hubs, rise in tourism and travel, strong economic growth and increasing standards of living, waxing demand for large-capacity aircraft among domestic airline companies, among others, are poised to drive gains in the industry in the upcoming years. Middle East especially is poised to grow into a noteworthy aviation powerhouse with airline carriers in the region having the phenomenal opportunity to take advantage of their location, capacity, infrastructure and network, to expand long-haul freight and traffic throughout the region.
Fuel costs and eco-efficient, sustainable transportation will emerge into prime areas of concern for the commercial aerospace sector. The air transportation industry, which currently accounts for over 4.0% of global CO2 emissions will come under increased pressure to confront the challenge of climate change and make air transport more eco-efficient, ever more so with air traffic poised to double over the coming decades. Airline operators will therefore continue to shift towards fleets offering greater fuel efficiency simultaneously with higher productivity. The industry will also score points in environmental performance by adopting new generation airplanes, efficient operating procedures and new fuel development. The field of alternative fuels research in this regard will attract huge investments and small twin-aisle planes and single-aisle planes will gradually be phased out and replaced with larger airplanes.
As stated by the new market research report on Aerospace and Defense (A&D), the US continues to remain the largest and most powerful regional market with its massive military expenditure acting as a principal determinant of trends in the world A&D market. While general aviation and commercial aerospace sectors in the country are recovering, the defense sector is slowing down. The prolonged period of high military spending, beginning from the Sep 11 attacks, which largely helped the sector to remain resilient through the 2007-2009 recession, is now showing signs of winding down. Reduced budgetary outlays for investments in land vehicles, ships, missile and As stated by the new market research report on aircrafts are expected as the government attempts to reduce the deficit gap by eliminating inefficiencies in weapon programs and reducing overheads.
While new spending limits, new definition of security (which includes prioritizing objectives and capabilities) and annual reductions lower the US defense budget baseline, developing countries like China which are vying for a strong military presence in the Pacific will generate growth opportunities. China is currently investing in a major military buildup with its ratio of defense spending to GDP expected to spiral to over 3.0% in the upcoming years. Asia-Pacific, not surprisingly, is the fastest growing regional market, displaying a CAGR of about 5.6% over the analysis period. Growth in this region is primarily driven by burgeoning demand for commercial aircrafts, increase in national defense expenditures, particularly in developing countries such as China and India. Modeling, Simulation & Training represents one of the fastest growing market segments with a projected CAGR of 5.2% over the analysis period.
Major players in the marketplace include Arianespace SA, ATR, B/E Aerospace Inc., BAE Systems Plc, Ball Aerospace & Technologies Corporation, Bell Helicopter Textron Inc., Bombardier Inc., Cessna Aircraft Company, CFM International Inc., DAHER-SOCATA, European Aeronautic Defense and Space Company (EADS), Airbus S.A.S, Eurocopter Group, Embraer-Empresa Brasileira de Aeronáutica S.A., Honeywell International Inc., Ilyushin Aviation Complex JSC, IRKUT Corporation, Israel Aerospace Industries Ltd., Kaman Corporation, Lockheed Martin Corporation, Pratt & Whitney, Rolls-Royce Plc, RUAG AG, Sikorsky Aircraft Corporation, The Boeing Company, and Turbomeca SA, among others.
The research report titled “Aerospace and Defense Industry: A Global Strategic Business Report” announced by Global Industry Analysts, Inc., provides a comprehensive review of trends and growth drivers, industry issues and challenges and recent industry activity. The study offers market estimates and projections in US$ million for major regional markets such as United States, Canada, Japan, Europe (France, Germany, UK, Italy, Spain, Russia and Rest of Europe), Asia-Pacific, Middle East, and Latin America.
Key product segments analyzed include Aircraft Products & Services (Airframe, Aircraft Engines, Aircraft Components), Commercial Avionics, Military Avionics, In-flight Entertainment, & MRO); As stated by the new market research report on Missiles (Air-to-Air, Air-to-Surface, Air Defense, Surface-to-Surface, Antiship, Antitank, Bombs (Guided), & Intelligent Munitions, among Others); Modeling, Simulation & Training Equipment (CBT & E-Learning, Military Training & Simulation, Commercial & Military Visual Simulation, & Commercial & Military Flight Simulation); C4ISR & Related Equipment (Unmanned Aerial Vehicle, Electronic Warfare, Mine Countermeasures, Naval Radar and Sonar, Chemical & Biological Agent Detectors, Infrared Imaging Systems and Components, Military Ground Communications, & Land-Based Surveillance Radar, among Others); Space Equipment (Launch Vehicles, Communications Satellites, & Earth Observation Satellites); and GPS (Geotechnologies) (Commercial Satellite Imaging, Commercial Aerial Imaging, GIS Software, Commercial SAR Data, & Commercial SAR Software).
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