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Military Drone Market Size, Share & COVID-19 Impact Analysis, By Product Type (Fixed Wing, Hybrid and Rotary Wing), By Range (Visual Line Of Sight (VLOS), Extended Visual Line Of Sight (EVLOS), and Beyond Line Of Sight (BLOS)), By Technology (Remotely Operated Drones, Semi-Autonomous Drones), By Application (Intelligence, Surveillance Reconnaissance and Targeting(ISRT), Combat Operations, Battle Damage Management), and Regional Forecast, 2020-2027

Region : Global | Format: PDF | Report ID: FBI102181

 

KEY MARKET INSIGHTS

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The global military drone market size was USD 10.53 billion in 2019 and is projected to reach USD 23.78 billion by 2027, exhibiting a CAGR of 12.12% during the forecast period.

COVID-19 Cover

This report covers COVID-19 impact analysis on Military Drone Market

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The growing utilization of unmanned aerial vehicles (UAVs) in the defense sector for diverse applications such as mapping, surveying, monitoring, transportation, and combat operations will fuel the demand for these drones in the upcoming years. Rising defence expenditures of several countries to purchase modern & advanced military drones for enhancing combat capabilities is projected to support the global market growth. UAVs are employed in battle damage assessment, communication intelligence, and electronic intelligence. Technological advancements in unmanned aerial systems have improved the surveillance efficiency in intelligence, surveillance, and reconnaissance (ISR) missions.   


The integration of artificial intelligence is modernizing drone technology, enabling drones to pick targets autonomously with precision and persistence. For example, in August 2020, the artificial algorithm of DARPA’s Air Combat Evaluation Program registered a win over the human pilot in a Lockheed Martin (LMT) F-16 simulator on a virtual platform at a competition sponsored by the Defense Advanced Research Projects Agency (DARPA). Extensive R&D and continuous innovations are enhancing the conventional role of multi-mission platforms in armed forces around the world. The strategic UAVs are expected to witness massive technological enhancements, superior endurance capabilities, high payload potential, and reliability in the future years. The growing demand for intelligent weapon systems in modern battle management is fueling the military UAVs market growth. In 2017, for instance, the French Defense Procurement agency signed an agreement with the drone company, Elistair, to finance its AIRWATCH projects. These projects will develop “dronebox”, a smart tethered drone for surveillance and telecommunications. The drone will support dual applications such as military and civilian safety. Government agencies are, thus, providing strong support to UAV manufacturing companies to enhance public safety.


Negative Impact on the Military Drone Market of COVID-19 to Continue 2020


The impact of the COVID-19 pandemic on the global economy is expected to be uncertain in the forthcoming years.  



  • COVID-19 pandemic also impacted production/manufacturing facilities and supply chains across the globe due to severe lockdown by the government affected regional and domestic demand for military drones. In Western Europe, several defense companies also witnessed an operational halt for a few months, resulting in production queues and late deliveries due to partial or complete lockdown in countries in this region.

  • The spending on the military & defense sector is likely to get impacted significantly due to negative GDP growth in both developed and developing countries in 2020. Moreover, several countries are likely to delay the planned purchases of these drones owing to the urgent need to improve critical healthcare infrastructure and hospital facilities.

  • Military contracts take a long time to materialize due to the long negotiation periods, extensive testing, evaluation & analyses, customizations, numerous trials, and face-to-face meetings. The pandemic has impacted new business development opportunities in this market owing to the highly-priced procurement contracts.

  • The purchase of defense equipment has also been affected due to the lack of confidence in the market, leading to the signing of fewer business contracts for these drones. Economic unrest in various countries is also likely to hamper future business contracts related to unmanned aerial systems.


LATEST TRENDS


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Introduction of Artificial Intelligence with Autonomous Flight System to Drive Market Growth


Drone technology is witnessing strong growth for the past several years owing to the constant innovation and R&D enhancing the capabilities. Drones are being integrated with modern sensors, LiDAR technology, high-tech cameras, GNSS, Infrared, and thermal imaging systems. The most advanced unmanned aerial vehicles are equipped with multiple sensor systems such as the global system for mobile communication (GSM), communication intelligence sensors, and air-to-air missiles. Nowadays, the most advanced unmanned aerial vehicles are fully capable of carrying various payloads attached to the internal weapons bay and large sensors. Artificial intelligence is currently being used commercially for autonomous flight systems in high altitude military drones.


Moreover, governments are rapidly expanding their UAV fleets to bolster their defense capabilities. For example, in June 2020, the Indian government announced plans to purchase more Heron drones from Israel, with the US-made Predator B also being on India’s UAV shopping list. Today India owns more than 70 Heron drones. In 2018, the Indian Heron drones crossed the Line of Actual Control (LAC) near Doklam and crashed on the Chinese territory. In the previous year, the same incident occurred without the model being identified. Since then, India has been actively working on the domestic production of unmanned aerial vehicles for its armed forces. India is also developing the domestic variant of the MALE attack drones called Rustom and Rustom-II.


DRIVING FACTORS


Continuous Growth of Global Military Expenditure Driving the Military Drones Industry


Most countries enhance their defense capabilities according to their financial power, domestic economic conditions, and the internal, external, geostrategic, and political scenarios. Military expenditure is a very important parameter for operations, maintenance, procurement, and R&D to ensure a country’s safety and security. According to the Stockholm International Peace Research Institute (SIPRI), global defense spending stood at USD 1.917 trillion in 2019, with a positive growth of around 3.6% from 2018 levels.


The global defense expenditure has recorded the highest ever hike in the past decade. The major share was accounted for by the U.S., followed by China, India, and Russia. The SIPRI observed around 7.2% higher global military expenditure in 2019 compared to 2010. Countries such as China, India, Russia, and Saudi Arabia have been investing large amounts towards upgrading their military & defense systems for the last several years. These factors are projected to fuel the demand for drones for the military in the next few years.


Growing Border Disputes in Various Countries to Fuel the Market


Many parts of the world are witnessing border disputes due to disagreements over the possession of land or to control the area between two or more states. Countries that have been facing territorial issues over the past few years include India, Pakistan, China, Nepal, Bangladesh, Iran, Afghanistan, Bhutan, Taiwan, Israel, Syria, and Russia. These countries are spending large amounts of money to purchase surveillance drones to enhance situational awareness by modernizing the patrolling on the border areas.


 In June 2020, the Indo-China border dispute turned deadly for the first time in more than four decades. Hundreds of Indian and Chinese troops have been engaged in a standoff in the Ladakh region in the Himalayas since May. Drone technology has been playing an important role in this conflict, with both countries deploying unmanned aerial vehicles for reconnaissance and logistics operations in the high altitude area.


RESTRAINING FACTORS


High Costs Associated with Advanced Electronics and Modern Systems to Limit Drone Adoption


The unmanned aerial vehicles are fully equipped with high-tech avionic systems, modern sensors, propulsion systems, payloads, and advanced flight management technology. These parameters are associated with high-quality hardware and sophisticated software systems depending upon the deployment of armed forces. These parameters increase the final price of these drones. The high product and expensive maintenance costs are projected to hamper the future market growth. The limited use in aerial spaces and restricted applications of UAVs in various countries will also hamper future demand.


SEGMENTATION


By Product Type Analysis


Rotary Wing Drone Segment to Grow at a Fast Pace  


Based on product type, the market includes fixed-wing, hybrid, and rotary wing. The fixed-wing segment is projected to hold the maximum share in this market during the forecast period. Fixed-wing UAVs are widely used in military and defense operations by armed forces across the globe. The superior structural benefits of these UAVs to carry surveillance operations in long-distance missions are fueling their demand. The most advanced and most powerful unmanned aerial vehicles are designed and constructed in fixed-wing structures owing to their excellent and accurate aerodynamics. These factors are projected to fuel the segment’s growth during the forecast period.


The rotary-wing unmanned aerial vehicles segment is likely to show attractive growth in the future years due to the extensive development of quad-copters in recent years. These are heavy load carriers rigorously used for spying, logistics, and transportation applications across the world. The rotary-wing vehicles are employed in tactical military operations for intelligence, surveillance, and reconnaissance missions. The growing demand for intelligence operations in various countries for information collection is projected to fuel the military drone market growth.


By Range Analysis


Extended Visual Line of Sight Segment to Grow at the Fastest CAGR in the Market


Based on range, the market is segmented into Visual Line of Sight (VLOS), Extended Visual Line of Sight (EVLOS), and Beyond Line of Sight (BLOS). The extended visual line of sight segment is projected to grow at the highest CAGR in the military UAVs market during the forecast period. UAVs are widely adopted in electronic warfare, proper battle management, and various long-range missions to gather important information.


Visual Line of Sight (VLOS) UAVs are used in key applications such as disaster relief & management, fire emergencies, and border patrol.


The Beyond Line of Sight (BLOS) type unmanned aerial vehicles can transport ammunition, weapons, and cargo to the targeted areas. There is a wide range of military drones to carry heavy payloads at specific locations during any critical situation. The growing awareness regarding the technology is progressing towards its commercialization and is anticipated to fuel segment growth in the coming years.


By Technology Analysis


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Autonomous Technology Segment to Register a High CAGR


In terms of end-user, the market is segmented into remotely operated drones, semi-autonomous drones, and autonomous drones. The remotely operated drone segment is expected to have a dominant share in the market during the forecast period. The commissioned UAVs are remotely operated across the globe owing to the stringent government regulations for long-range autonomous flights.


The remote control technology, along with the radio links, is installed in command & control (C&C) and other telemetry systems in military drones. A wide range of unmanned aerial vehicles commissioned in the military is equipped with satellite receivers as part of the satellite navigation systems for long-range flights. The radio signal from orbit satellites is captured by the UAVs, which ensure the precise location, timing, and determine the path through the navigation systems that provide flight accuracy and reliability.


The autonomous segment is expected to grow at the fastest CAGR during the forecast period. Several countries are focusing on the innovation and development of autonomous unmanned aerial vehicles to the important tactical and strategic services.


The semi-autonomous segment is expected to register notable growth by the end of the forecast period owing to the rising preference for fixed-range flight operations to gather useful information.


By Application Analysis


Logistics and Transportation Segment to Register a High CAGR


In terms of application, the market is segmented into intelligence, surveillance reconnaissance and targeting (ISRT), combat operations, battle damage management, logistics & transportation, and others. The intelligence, surveillance, reconnaissance, and targeting (ISRT) segment is expected to hold a leading position in this market during the forecast period. The dominance by the segment is attributed to the role of unmanned aerial systems in the defense industry rather than in combat operations.


These flying machines are designed to collect data and crucial information from the targeted territory. They are extensively utilized in the military and defense sector in many countries in military applications such as remote sensing, border monitoring, security, & surveillance, and mapping. The army, air force, navy, and other security agencies have been using unmanned aerial vehicles for transportation and logistics applications for many years now. The growing demand for logistics and transportation is projected to fuel market growth in the coming years.


REGIONAL INSIGHTS


North America Military Drone Market Size, 2019 (USD Billion)

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Geographically, the market is categorized into North America, Europe, Asia Pacific, and Rest of the World. North America held a major share in the military unmanned aerial vehicles market in 2019 owing to the presence of several OEMs operating across the U.S. and Canada. The increasing investments of private players in the region, along with promising developments in the U.S. Army, has sped up advancements in drone technology. The U.S. is one of the major exporters of military drones across the globe, driving regional growth at a rapid pace.


The market in Europe is expected to grow at a moderate CAGR owing to the rising necessity of situational awareness, which is pushing countries to enhance the capabilities of their armed forces with modern technologies. Germany, France, and the UK are in the race to purchase small and tactical drones to enhance their intelligence and surveillance capabilities for the future years.


The market in Asia Pacific is expected to exhibit healthy growth owing to the increasing military expenditures of various countries. According to official sources, China sold over 48 GJ-2 drones to Pakistan under the export brand name ‘Wing Loong II’. GJ-2 is an 11-meter long MALE drone with a payload capacity of 480kg. This drone can carry around 12 missiles or attack bombs and has a top speed of 380 km/hr and a cruising speed of 200 km/hr. In June 2018, the PLA was reportedly deploying the CH-4 large reconnaissance/strike drones and BZK-005C high altitude drones in the Tibetan plateau area. In addition to this, market players in this region are making heavy investments, which in turn is fueling the demand for military type of drone products.


Latin America & the Middle East & Africa accounted for a comparatively lower share of the market owing to the presence of a huge underpenetrated market.


KEY INDUSTRY PLAYERS


Dominance of Large Defense Companies to Characterize Market Competition


The market is fragmented owing to the strong product portfolio of military drone manufacturers in developed and developing countries. Currently, Northrop Grumman, Lockheed Martin, and Thales Group are leading the market, accounting for a dominant military drone market share in 2019. However, the lack of strong barriers to entry is projected to lead to an increasing number of domestic military drones companies entering the global market. The growing number of companies entering the drone industry is projected to lead to a highly fragmented market by 2027.


Other key players such as General Atomics Aeronautical System (US), Boeing (US), Elbit System (Israel), AeroVironment Industries (US), Textron Systems (US), Israel Aerospace Industries (Israel), SAAB Group (Sweden) have also entered the market competition with drone offerings. Introduction of innovative product ranges such as AI-powered drones, Automatic Take-off, and Landing (ATOL), combat drones, strategic acquisition, and collaboration are some of the major strategies adopted by market players operating in this market.


LIST OF KEY COMPANIES PROFILED:



  • General Atomics Aeronautical Systems, Inc. (US)

  • Northrop Grumman Corporation (US)

  • Elbit Systems Ltd. (Israel)

  • Israel Aerospace Industries Ltd. (Israel)

  • AeroVironment, Inc. (US)

  • Lockheed Martin Corporation (US)

  • Thales Group (France)

  • Boeing (US)

  • BAE Systems (UK)

  • SAAB  Group (Sweden)

  • Textron Systems (US)

  • Other Players


KEY INDUSTRY DEVELOPMENTS:



  • May 2020 – FLIR Systems, the US-based drone manufacturing company, secured an additional contract worth USD 20.6 million from the U.S. Army. The company will supply FLIR Black Hornet 3 Personal Reconnaissance Systems (PRS) to support platoon and small unit level surveillance & reconnaissance capabilities to the U.S. Army.

  • July 2020 – The Pentagon has awarded a new contract to four companies worth USD 400 million. The four companies are Boeing Co., General Atomics Aeronautical Systems Inc., Kratos Unmanned Aerial Systems Inc., and Northrop Grumman Systems Corp. The contract includes the delivery orders for AI-powered drones for its Air Force program called Skyborg.

  • July 2020 – SRC, Inc. received a contract worth USD 426 million to supply a defense system against small drones by the U.S. army. The contract consists of a mobile system, including a radar camera, jamming technology, and sensors for and tracking and identifying hostile drones on the battlefield.

  • August 2020 – The U.S. Department of Defense’s (DOD) Defence Innovation Unit (DIU) tested and approved almost five drones for governmental and military use. The five DIU-approved drones include Skydio’s X2-D, Parrots’ Anafi USA, Altavian’s M440 Ion, Teal Drones Golden Eagle, and Vantage Robotics Vesper.


REPORT COVERAGE


An Infographic Representation of Military Drone Market

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The market research report provides detailed industry analysis and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers insights into market trends and highlights key industry research and developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the advanced market over recent years.


Report Scope & Segmentation














































  ATTRIBUTE



  DETAILS



Study Period



  2016-2027



Base Year



  2019



Forecast Period



  2020-2027



Historical Period



  2016-2018



Unit



  Value (USD Billion)



Segmentation



By Product Type



  • Fixed Wing

  • Hybrid

  • Rotary Wing



By Technology



  • Remotely Operated Drones

  • Semi-Autonomous Drones

  • Autonomous Drones



By Range



  • Visual Line Of Sight (VLOS)

  • Extended Visual Line Of Sight (EVLOS)

  • Beyond Line Of Sight (BLOS)



By Applications



  • Intelligence, Surveillance Reconnaissance And Targeting (ISRT)

  • Combat Operations

  • Battle Damage Management

  • Logistics & Transportation

  • Others



By Geography



  • North America (The U.S. and Canada)

  • Europe (The U.K., Germany, France, Italy, Spain, Russia, and Rest of Europe)

  • Asia-Pacific (Japan, China, India, Australia, Southeast Asia, and Rest of Asia- Pacific)

  • Rest of the World (The Middle East & Africa and Latin America)



Frequently Asked Questions

Fortune Business Insights says that the global market size was USD 10.53 billion in 2019 and is projected to reach USD 23.78 billion by 2027.

In 2019, the North America market value stood at USD 3.8 billion.

Growing at a CAGR of 12.12%, the market will exhibit impressive growth during the forecast period (2020-2027).

The fixed-wing segment is expected to be the leading segment in this market during the forecast period.

Increasing demand for surveillance military drones in various countries and the development of innovative unmanned aerial vehicles by market players are the major factors driving the growth of this market.

Northrop Grumman, Lockheed Martin, and Thales Group are the major players in the global market.

North America dominated the market share in 2019.

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