Europe Defense Electronics Market Size, Share, and Industry Analysis, By Vertical (Navigation, Communication, and Display, Electronic Warfare, Optronics, Radars, and C4ISR), By Navigation, Communication, and Display (Avionics, Vetronics, and Integrated Bridge Systems) By Electronic Warfare (Jammers, Self-protection EW Suites, Directed Energy Weapons, Directional Infrared Countermeasures, Antennas, IR Missile Warning Systems, & Others), By Optronics, By Radars, By C4ISR, By Platform, By Land, By Marine, By Airborne, By Space, and Country Forecast, 2025-2032

The Europe defense electronics market size was worth USD 23.74 billion in 2024. It is projected to be worth USD 25.61 billion in 2025 and reach USD 36.58 billion by 2032, exhibiting a CAGR of 5.22% during the forecast period. 

The defense electronics sector in Europe encompasses essential technologies such as surveillance systems and radars, cyber-electromagnetic tools and electronic warfare, secure communication systems, Command, Control, Communications, Computers & Intelligence (C4I), avionics, drones, counter-drone systems, and the integration of battlefield data. European nations and the EU are proactively supporting growth via a range of coordinated policies and funding mechanisms. Initiatives such as the European Defense Fund, the European Defense Industry Programme, (European Defense Industry Reinforcement Through Common Procurement Act) (EDIRPA) for joint procurement, Act in Support of Ammunition Production (ASAP) for ammunition production, and the Readiness 2030/ReArm Europe Plan are all designed to promote collaborative research and development, streamline procurement processes, improve industrial readiness, and lessen reliance on suppliers outside the EU.

Europe Defense Electronics Market Trends

Focus on Strategic Alliance and Industrial Partnership is a Latest Market Trend

Across Europe, nations are increasingly establishing strategic partnerships and industrial collaborations to enhance their defense electronics capabilities. Rather than each country developing systems independently, governments and businesses are now joining forces on collective endeavors, such as shared radar networks, missile defense initiatives, and drone technologies. These alliances help to cut costs and eliminate redundancy, and assist in creating common standards and boosting interoperability among European armed forces.

Major initiatives such as the European Sky Shield Initiative and EU-sponsored projects involving various defense companies. 

This transition toward regional collaboration which is emerging as a significant trend in making Europe's defense sector more cohesive and robust.

 Key takeaways

• In the Electronic Warfare segmentation, Jammers accounted for around 15.33% of the market in 2024.
• In the Optronics segmentation, Handheld Systems is projected to grow at a CAGR of 4.18% over the forecast period.
• In the marine segmentation, submarines are projected to grow at a CAGR of 5.33% of the market over the forecast period. 

Europe Defense Electronics Market Growth Factors

Government Initiatives in Defense Sector are Projected to Boost Market Growth

European governments, along with the European Union, are making concerted efforts to enhance the region’s defense capabilities, particularly in electronics. Through significant initiatives such as the European Defense Fund, Readiness 2030, and EDIRPA, the EU is promoting cooperation among countries and companies to advance vital technologies, including secure communications, electronic warfare systems, and drone infrastructure. 

These programs provide financial assistance, simplified regulations, and collaborative research and development projects, facilitating innovation and competition for both large defense contractors and smaller producers. The objective is to bolster defense preparedness and to establish a more robust and self-sufficient European defense sector, which is anticipated to stimulate sustainable growth in defense electronics over the long term.

Europe Defense Electronics Market Restraints

Regulatory Complexity and Export Restrictions Constraint Limit Market Growth

A major obstacle for the Europe defense electronics market growth is the intricate and divided regulatory landscape among various countries. Each nation has its unique regulations concerning defense exports, technology transfers, and security clearances. Export limitations hinder the competitiveness of European defense companies on the global stage, as varying policies diminish flexibility and escalate legal uncertainties.

Europe Defense Electronics Market Segmentation Analysis

By Vertical 

Based on vertical, the market is divided into navigation, communication, and display, electronic warfare, optronics, radars, and C4ISR.

In 2024, the European market was led by the navigation, communication, and display segment. The growth is prompted by the crucial necessity for these technologies in military activities and the rising requirement for sophisticated systems such as GPS, satellite positioning, and secure communication solutions. Moreover, these systems also improve situational awareness and facilitate accurate navigation for a range of platforms, including aircraft, naval ships, and ground units.

By Navigation, Communication, and Display 

Based on navigation, communication, and display, the market is divided into avionics, vetronics, and integrated bridge systems.

The avionics segment dominated the market in 2024. This dominance is driven by the rising need for advanced navigation, communication, and surveillance systems in military aircraft and unmanned aerial vehicles (UAVs). Ongoing advancements in aircraft technology, the incorporation of AI, and the expansion of private aviation further enhance the avionics segmental growth.

By Electronic Warfare

Based on electronic warfare, the market is segmented into jammers, self-protection EW Suites, directed energy weapons, directional infrared countermeasures, antennas, IR missile warning systems, identification friend or foe systems, laser warning systems, radar warning receivers, and others.

Self-protection EW Suites dominated the Europe defense electronics market share in 2024. European nations are improving their defense capacities to address new challenges, resulting in considerable investment in sophisticated self-defense systems to guarantee efficacy in hostile settings.

By Optronics

Based on optronics, the market is bifurcated into handheld systems and EO/IR payloads.

The EO/IR segment dominated the market in 2024. There is a growing demand for enhanced situational awareness, accurate targeting, and immediate intelligence collection due to the changing threats posed by drone intrusions and asymmetric warfare.

By Radar 

Based on radar, the market is segmented into surveillance and airborne early warning radars, tracking and fire control radars, ground penetrating radars, weather radars, counter-drone radars, air traffic control radars, and other.

The surveillance and airborne early warning radars segment dominated the market in 2024. Increased geopolitical conflicts and the growing necessity for robust air defense and border protection fuel the growth. Furthermore, these systems play a crucial role in identifying threats, enhancing situational understanding, and facilitating rapid responses, resulting in heightened investment from defense agencies.

By C4ISR

Based on C4ISR, the market is segmented into sensor system, communication & network technologies, display & peripherals, and others.

The communication & network technologies segment dominated the market in 2024. European nations are modernizing their armed forces to improve coordination and interoperability between different military branches and with allies. Communication and network technologies form the backbone of these integrated systems, connecting land, sea, air, and cyber operations for efficient command and control.

By Platform 

Based on platform, the market is segmented into land, marine, airborne, and space. 

The land segment dominated the market in 2024. The growth is owing to higher defense budgets driven by geopolitical conflicts, an emphasis on upgrading ground systems such as tanks and infantry combat vehicles, and the movement toward compatible solutions through programs such as the European Defense Fund.

By Land

Based on land, the market is segmented into dismounted soldier systems, military fighting vehicles, and command centers.

 The military fighting vehicles segment dominated the market in 2024. This growth is formed by rising geopolitical conflicts, the ongoing Russia-Ukraine conflict, and an emphasis on strengthening land-based capabilities, particularly in nations such as the U.K., Germany, and France.

By Marine

Based on marine, the market is segmented into aircraft carriers, amphibious ships, destroyers, frigates, submarines, and unmanned maritime vessels. 

The submarine segment accounted for the highest market share in 2024. This is fueled by significant investments in research and development in fields such as anti-submarine warfare (ASW) are being motivated by geopolitical factors and security needs.

By Airborne

Based on airborne, the market is segmented into military aircraft, military helicopters, and unmanned aerial vehicles.

Military aircraft dominated the market in 2024. The growth is due to the rising need for sophisticated fighter jets, drones, and reconnaissance aircraft, coupled with ongoing funding for electronic warfare as well as intelligence, surveillance, and reconnaissance (ISR) technologies.

By Space 

Based on space, the market is segmented into LEO satellites, MEO satellites, and GEO satellites. 

LEO satellites dominated the market in 2024. LEO satellites provide improved surveillance capabilities and allow for more regular imaging of targeted locations. Defense agencies in Europe are currently channeling investments into LEO satellite technology for a range of uses, such as communications, military reconnaissance, and imaging.

By Country

Based on country, the market is segmented into the U.K., Germany, France, Italy, Russia, and the Rest of Europe.

The U.K. holds a substantial portion of Europe’s defense electronics sector, propelled by considerable government funding and a solid industrial foundation. Major players such as BAE Systems, Leonardo U.K., and Rolls-Royce are at the forefront of creating advanced radar, electronic warfare systems, secure communications, and autonomous technologies. The U.K. aims to update its defense capabilities, prioritizing innovation, resilience, and interoperability.

• In June 2025, the U.K. Ministry of Defense announced a USD 6.25 billion investment to improve military technology. Around USD 5 billion of this will go toward developing autonomous systems, including new drones and a special "drone center." Nearly USD 1.25 billion is allocated for advanced weapons such as the DragonFire laser system, which will be installed on Royal Navy ships.

List of Key Companies in Europe Defense Electronics Market

Thales (France), Leonardo (Italy), BAE Systems (U.K.), Rheinmetall, and Hensoldt (Germany) are considered key players in the market due to their robust expertise in radar technology, electronic warfare, communication systems, and sensor applications. These firms gain advantages through strong collaborations with national governments and engagement in joint European defense initiatives, providing them with a competitive advantage in both local and global markets.

LIST OF KEY COMPANIES PROFILED:

• Thales Group (France)
• Leonardo S.p.A.  (Italy)
• BAE Systems plc. (U.K.)
• Rheinmetall AG (Germany)
• HENSOLDT AG (Germany)
• Saab AB (Sweden)
• Airbus Defense and Space (Netherlands)
• Indra Sistemas, S.A.  (Spain)
• Elbit Systems Ltd. (Israel)
• Kongsberg Gruppen ASA (Norway)
• Rohde & Schwarz GmbH & Co. KG (Germany)

KEY INDUSTRY DEVELOPMENTS:

• March 2025: Thales Group obtained a significant contract from the European Union to provide cutting-edge ground-based radar systems as a component of the European Sky Shield Initiative. This initiative seeks to improve integrated air and missile defense among various EU member nations by installing advanced radar sensors and command-and-control systems.
• April 2024:  Leonardo received a contract from the U.K. Ministry of Defense (MOD)’s Defense Equipment and Support (DE&S) agency to provide, develop, and enhance the tools that produce and evaluate data utilized by the U.K. Armed Forces’ combat aircraft.

REPORT COVERAGE

The Europe defense electronics market report provides a detailed analysis of the market. It focuses on defense spending market dynamics, technological innovation, and key industry developments, such as mergers and acquisitions, competitive landscape. Besides this, the report also offers insights into the latest industry trends and the impact of various factors on the demand for defense electronics.

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