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The U.S. electro-optics infrared systems market size was USD 5.55 billion in 2019 and is projected to reach USD 7.40 billion by 2027, exhibiting a CAGR of 6.19% during the forecast period.
The electro-optics infrared (EO/IR) system consists of a visible and infrared sensor. The electro-optics sensors integrated with the EO/IR system provides detailed information such as target distance, shape, size, and other minute details required to identify and detect the target during day and night.
The EO/IR system is installed on airborne platform vehicles, ground vehicles, naval vessels, and military weapons. Moreover, it can be used as a hand-held detection device for the ground-based application. Thus it is aggregating the demand for the military electro-optics infrared system market.
COVID-19 Pandemic Results in Postponed or Suspended EO/IR Contracts
The U.S. is experiencing a negative impact due to the COVID-19 pandemic on the aerospace and defense industry. The sudden halt in EO/IR manufacturers' supply chain due to the U.S. lockdown has forced manufacturers to suspend or postpone EO/IR systems contracts. Thus, to overcome this impact, the major companies such as L3 Harris Technologies, Northrop Grumman Corporation, FLIR Systems, Inc., and General Dynamics Corporation have redesigned the EO/IR system's production structure.
The major U.S. defense alliances with countries such as Israel, France, Japan, India, and others have been largely hampered due to the pandemic. However, components and systems providers collaborate with small-scale companies to enhance onboard technological capabilities and overcome the pandemic's negative impact.
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Increasing Demand for Advanced 3D Visualization Technology for the Military Operations to Augment Growth
The 3D visualization technology refers to the pre-recorded data, satellite data, unmanned aerial vehicle data, video footage, and photographs to represent the target's hologram. The hologram can project the 3D view of the target and provide the specific height and terrain of the object above sea level. This enables it to be helpful to understand the target and its complete surrounding area. Therefore, 3D visualization is majorly preferred for surveillance in military missions.
The U.S. deployed 3D visualization systems to understand the battlefield scenarios with high accuracy and a minimal time frame. This factor has increased the adoption of imaging EO/IR systems to improve the mission abilities.
Increasing Adoption of EO/IR Sensors in the U.S. Military Battlefield Operations to Boost Market Growth
Change in warfare and battlefield operations has increased the need for modernization of conventional military equipment into highly advanced systems. Modernization is necessary to keep pace with the technological advancements during warfare. This is expected to increase the demand for long-range EO/IR sensor systems for surveillance purposes.
The U.S. Department of Defense (DoD) is strongly focused on upgrading their defense platforms. For instance, in 2019, the U.S spent USD 718.69 billion to modernize its armed forces and enhance its combat capabilities. The increasing defense budgets have led to the rise in the procurement of advanced surveillance equipment, air defense systems, unmanned helicopters, warships, submarines, missiles, and others, which is predicted to boost the growth of the market during the forecast period.
Increasing Deployment of Technologically Advanced UAVs to Drive the Market Growth
An increase in the deployment of UAVs for military and commercial applications is mainly driving the growth of the market. The UAVs are used for military tactical, strategic and commercial applications such as forest monitoring, photogrammetric survey, and infrastructure inspection. These applications are based on remote sensing tasks to collect crucial information through the advanced visible and infrared camera. This camera helps in detecting and tracking a target or potential threats during day and night time. Recently, in February 2019, UAVOS Inc. introduced its novel UVH-170E vertical takeoff and landing UAV with an improved electro-optical infrared systems payload. This UAV has been designed to use in tropical climate and applications, including law enforcement, counter-terrorism, ISR, and search and rescue. These factors are anticipated to fuel the demand for the EO/IR system in the upcoming years.
Stagnant Timeframe of EO/IR System to Hinder Growth
The EO/IR system is highly preferred for military applications due to its advanced features such as high operational efficiency, high integration, and compatibility to operate under various unmanned aerial system platforms for night light target identification and target tracking.
However, design complexity and fundamental theories limit the long-range photography, camera size, and performance of the EO/IR system. These constraints in the design and development of the military miniature lightweight electro-optics infrared system are expected to hamper the growth of the market.
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Growing Adoption of Imaging EO/IR systems for Military Application to Drive Market Growth
The market is divided into imaging EO/IR systems and non-imaging EO/IR systems.
The imaging EO/IR system segment is projected to grow at a higher CAGR during the forecast period. The demand for imaging EO/IR systems is high due to its increased adoption in military applications, including border monitoring, target tracking, situational awareness, C5ISR, and tactical mission. This system is further used to improve target detection, identify threats from a longer distance, and target monitoring in different weather conditions.
The non-imaging EO/IR system is expected to be a larger segment in 2019. The wide implementation of a non-imaging EO/IR system for search and rescue, surveillance, and real-time information has contributed to a larger market share in 2019.
Cooled Technology Segment to Experience Considerable Growth Owing to Rising Adoption for Long Range Surveillance Applications
In terms of technology, the market is segmented into cooled and uncooled technology.
The cooling technology segment held a larger share in 2019 and is expected to grow at a considerable rate during the forecast period. This is owing to the rising development of cost-efficient cooling technology. Moreover, cooling technology offers high sensitivity, improved stability, and improved performance over uncooled technology. Previously, cooled EO/IR systems were typically used to operate in mid-wave infrared (3μ-5μ) wavelengths (MWIR). Nowadays, it is majorly designed to enable imaging in the long-wave infrared (LWIR) band to improve the surveillance application abilities during battlefield operations.
The demand for uncooled technology-based EOIR systems has reduced in recent years for SWIR and MWIR applications as it offers less sensitivity than cooled technology.
Rising Adoption of Staring Technology for Fast Target Detection to Propel Market Growth
Based on sensor technology, the market is segmented into the staring sensor and scanning sensor.
The staring sensor technology segment accounted for a larger market share in 2019 and is anticipated to be the fastest-growing segment during the forecast period. This growth is attributed to the rising demand for quick target detection solutions for surveillance and military combat mission applications. The staring sensor technology-based EO/IR system projects an image of a target within a short time span than the scanning technology based EO/IR system. This has propelled the growth of the market segment.
The scanning sensor utilizes a limited number of detectors to scan an image that leads to a longer duration to project the image. Thus, the demand for scanning sensor technology has decreased, leading to slow growth of the segment during the forecast period.
Multispectral Imaging Technology Segment Registered a Higher CAGR in 2019
In terms of imaging technology, the market is segmented into multispectral and hyperspectral.
The multispectral imaging technology segment dominated the market with a larger market share in 2019. It is attributed to the increased adoption of a multispectral EO/IR system in several applications, such as remote sensing, military target tracking, land mine detection, ballistic missile detection, environmental monitoring, and serving and mapping. In 2019, the U.S. Department of Defense (DoD) invested USD 13.9 billion for the missile defeat and defense program.
Increased Development of Long-Range EO/IR System for Military Application to Aid Growth of LWIR Segment
Based on the wavelength, the market is classified into ultraviolet, visible, near-infrared, short-wavelength infrared (SWIR), medium wavelength infrared (MWIR), and long-wavelength infrared (LWIR)
Among these, the long-wavelength infrared segment is expected to grow at a higher CAGR during the forecast period. This growth is attributed to the increasing demand for long-range image tracking to improve soldier safety and military capabilities. For instance, the FLIR System developed the Star SAFIRE 380-HD EO/IR system that provides superior image stabilization, ultra-long range imaging performance, and metadata embedded in the digital video.
Rising Adoption of EO/IR System for Land-Based Armored Vehicles to Exhibit The Highest CAGR
In terms of platform, the market is classified into airborne, land, and marine/naval.
The airborne segment dominated the market with the largest share in 2019 due to the high spending on the U.S. DoD aircraft platform. In 2019, the U.S. DoD enacted USD 194.8 billion for the air force compared to the 161.8 billion in 2016. Moreover, the growing adoption of the EO/IR system in the development of military UAVs is driving the growth of the market during the forecast period.
The land segment is expected to grow at the fastest growth rate during the forecast period. This is due to an increase in demand for advanced ground military vehicles in the U.S. to strengthen military capabilities.
Land Platform Based Laser Range Finder Dominated the Market In 2019
Based on the laser range finder (LRF), the market is classified into airborne, land, and marine/naval.
The land platform segment dominated the market with the largest share in 2019. This is owing to the increased installation of a laser range finder on armored vehicles to enhance defense capabilities. Moreover, the rising development of the anti-missile system and increased U.S. DoD spending on it are the factors that are expected to support the growth of the market during the forecast period. The U.S. DoD planned to invest USD 21.3 billion for the procurement of missiles and munitions by 2021.
Military End User Segment Dominated the Market in Base Year
In terms of end-user, the market is divided into commercial and military.
The military segment accounted for a larger share in 2019. The segment is anticipated to experience a high market growth during the forecast period due to the huge adoption of the EO/IR system in military and defense applications. Moreover, increased procurement of advanced UAVs for military applications propels the demand for highly reliable and efficient multi-sensor EO/IR systems.
Electro-optics infrared systems market in the U.S. is anticipated to showcase significant growth during the forecast period. This growth is due to the rising demand for modern warfare programs by the U.S. DoD to tackle China, Russia, and other military forces. The U.S. Army is extensively known for developing and procuring advanced systems, missiles, aerial systems, combat machines, and attack systems. The increasing focus on maritime warfare, target acquisition capability, naval platform, and combat systems will fuel the demand for advanced EO/IR systems in the forthcoming years. Moreover, the rise in the territorial and sea disputes across the U.S. will boost demand for the EO/IR system for UAVs, fighter aircraft, and naval aircraft.
Key Players Focus on Development of Innovative EO/IR system to Strengthen Their Market Position
Key companies focus on restructuring its supply chain management to streamline the operational process and resume for the scheduled contracts. Moreover, the companies invest in research and development capabilities to develop cost-effective EO/IR systems integrating technologically advanced components.
An Infographic Representation of U.S. Electro-Optics Infrared Systems Market
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The market research report provides a detailed analysis of the market. It encompasses key aspects such as R&D capabilities and optimization of the manufacturing process. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the growth of the advanced market over recent years.
Value (USD Billion)
By Sensor Technology
By Imaging Technology
By Laser Range Finder (LRF)
Fortune Business Insights says that the market size was USD 5.55 billion in 2019 and is projected to reach USD 7.40 billion by 2027.
Growing at a CAGR of 6.19%, the market will exhibit steady growth in the forecast period (2020-2027).
The imaging system segment is anticipated to be the leading segment in this market during 2020-2027.
The increasing adoption of sensor integrated systems in the U.S. military battlefield operations is a major factor that is driving the growth of the market.
L-3 Harris Technologies Inc., Raytheon Technologies Corporation, and Northrop Grumman Corporation, Lockheed Martin Corporation, FLIR Systems, Inc. are major players in the U.S. market.
The market key players focus on adopting advanced manufacturing technologies to meet the end-user demand.
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