World Avionics ATE Markets

Frost & Sullivan, August 2004

Growth in Avionics Technology Necessitates the Production of Newer Test Systems

Test vendors in the automatic test equipment (ATE) market are greatly challenged by the growing demand for advanced avionic test systems. In a bid to align their legacy systems with upcoming technology in the line replaceable units (LRU) space, most vendors are trying to develop a newer, more compatible test program sets (TPS). Large prime manufacturers such as Boeing and Lockheed-Martin that test their LRUs with ATE systems developed in-house also pose a serious threat to independent vendors. Since these manufacturers own both a sizeable market share and the contract, any technology adopted by them is soon likely to become the industry standard. This trend is expected to curb the growth of vendors that do not develop their own in-house systems.

This research from Frost & Sullivan examines the potential of the military and the commercial avionics ATE market. It critically evaluates the performance of leading participants in terms of unit shipment and provides a comprehensive insight into the drivers and restraints affecting the market. Detailed revenue forecasts and regional analysis give a clear idea of the expansion opportunities that are available in the industry. Additionally, it outlines strategies that are likely to assist participants in positioning themselves.

Shorter Life Cycle of Avionics Modules Challenges Vendors as Investments Required for Test Systems Increase

While considering the installation of a new TPS, it is essential to balance its developmental costs against the cost and life cycle of the particular module to be tested. The life cycle of avionics has been on the decline, and some vendors are of the opinion that the utility of the TPS might not justify the investment made on it, says the analyst. If the avionics device is cheap enough to warrant quicker replacement, there is no financial sense in installing an expensive TPS.Vendors, therefore, have an immediate need for a TPS, which can test an avionics module quickly and cost-effectively. This is further emphasized as the avionics industry continues to accommodate cheaper and more easily replaceable avionic devices.

Rising Demand from the Military Sector for Sturdier, Mobile Test Systems

Test vendors have always considered military requirements as a major source of revenue. However, the military is seriously concerned by the inability of test systems to be transported to the field.Vendors have been trying to evolve more rugged test systems that can be widely deployed, notes the analyst. Since there are ATE systems, which are meant for a particular LRU, it is quite a task to first build these rugged systems and then transport an array of such systems to the field.

1. Executive Summary
        1. Executive Summary
                1. Executive Summary
2. Total Avionics ATE Market
        1. Overview
                1. Overview And Definitions
                2. Market Engineering Measurements
Overview
                3. Market Engineering Measurements
Sizing Analysis
                4. Market Engineering Measurements
Structure Analysis
                5. Challenges
                a. Aligning the legacy test systems with newer technology in the LRU (Line
                    Replaceable Units) space
                b. Developing Test Systems that can be more compact, mobile and rugged
                c. Coping with the cost of developing a TPS along with the short life cycle of
                    the LRU to be tested.
                d. Entry level business and taxi jets will drive the growth of commercial
                    avionics market in future, but standardization will be a key challenge to be
                    met
                6. Drivers
                a. Upgrade market is likely to drive fighter aircraft market over the forecast
                    period
                b. Reduced cost of integration due to low cost COTS (Commercial Off-The-Shelf)
                    based technologies
                c. Emphasis on improving air safety with latest surveillance and navigation
                    equipment is likely to drive growth for the commercial avionics ATE market
                d. Europe establishes a set of standards for combat aircraft avionics, which is
                    expected to result in the growth of the European ATE market in Future
                e. Fighter Aircraft projects such as JSF and Eurofighter
Typhoon spur demand
                f. The emergence of new low fare airlines is expected to drive demand in the near
                    future
                7. Restraints
                a. Competition from large prime manufacturers
                b. Lack of full knowledge of the technology associated with the LRUs (Line
                    Replaceable Units)
                c. Sluggish growth in the commercial aviation industry has hindered any large
                    scale purchase of ATE equipment into the commercial avionics market
                d. High cost of ATE system impedes penetration into the Asian Market
                e. Slow growth of the global economy and spike in the price of ATF (Aviation
                    Turbine Fuel)
        2. Forecasts Trends and Revenue Analysis
                1. Revenue Forecasts
                2. Market and Technology Trends
                3. Pricing Trends
        3. Competitive Structure and Market Share Analysis
                1. Competitive Structure
        4. Geographic Analysis
                1. Demand Analysis
                2. North America
                3. Europe
                4. Asia
Pacific
                5. Rest
of
World
3. World Commercial Avionics ATE Market
        1. Overview
                1. Overview and Definitions
                2. Market Engineering Measurements
Overview
                3. Market Engineering Measurements
Sizing Analysis
                4. Market Engineering Measurements
Structure Analysis
                5. Challenges
                a. Aligning the legacy test systems with newer technology in the LRU (Line
                    Replaceable Units) space.
                b. Developing test systems that can be more compact, mobile and ruggedized
                c. Entry level business and Taxi Jets will drive the growth of commercial
                    avionics ATE market in future, but standardization will be a key challenge to
                    be met
                d. Coping with the cost of developing a TPS along with the short life cycle of
                    the LRU to be tested
                e. Avoiding peaks in expense by expanding only gradually to develop ATE systems
                    for the new aircraft type
                f. Training technicians on a regular basis
                6. Drivers
                a. Emphasis on improving air safety with latest surveillance and navigation
                    equipment will drive growth for the commercial avionics ATE market
                b. New mandates drive upgrade market in the avionics arena
                c. NexGen ATE systems are likely to drive growth in the near future
                d. Emergence of new low fare airlines are likely to drive demand in the near
                    future
                7. Restraints
                a. Lack of full knowledge of the technology associated with the LRUs (Line
                    Replaceable Units)
                b. High cost of ATE systems impede penetration into the Asian Market
                c. Sluggish growth in the commercial aviation industry has hindered any large
                    scale purchase of ATE equipment into the commercial avionics market.
                d. Slow growth of the global economy and spike in the price of ATF (Aviation
                    Turbine Fuel)
        2. Forecasts Trends and Revenue Analysis
                1. Revenue Forecasts
                2. Demand Analysis
                3. Revenue Forecasts
ATE for LRUs
                4. Revenue Forecasts
ATE for Depots
                5. End User Analysis
                6. Market and Technology Trends
        3. Competitive Structure and Market Share Analysis
                1. Competitive Structure
                2. Market Share Analysis
        4. Frost & Sullivan Awards
                1. Market Leadership Award
        5. Geographic Analysis
                1. Demand Analysis
                2. North America
                3. Europe
                4. Asia
Pacific
                5. Rest
of
World
4. World Military Avionics ATE Market
        1. Overview
                1. Overview and Definitions
                2. Market Engineering Measurements
Overview
                3. Market Engineering Measurements
Sizing Analysis
                4. Market Engineering Measurements
Structure Analysis
                5. Challenges
                a. Coping with the uncertainty in the United States and European defense
                    spending
                b. Developing Test Systems that are likely to be more compact, mobile and
                    ruggedized
                c. Coping with the cost of developing a TPS along with the short life cycle of
                    the LRU to be tested
                d. Training technicians on a regular basis
                6. Drivers
                a. Upgrade market is likely to drive avionics ATE fighter aircraft market over
                    the forecast period
                b. Reduced cost of integration due to low cost COTS based technologies
                c. Europe establishes a set of standards for combat aircraft avionics, which is
                    expected to result in the growth of the ATE market in Europe in future
                d. Fighter aircraft projects such as JSF and Eurofighter-Typhoon spur demand
                7. Restraints
                a. Competition from large prime manufacturers
                b. Lack of full knowledge of the technology associated with the LRUs (Line
                    Replaceable Units)
                c. High cost of ATE systems impede penetration into the Asian Market
        2. Forecasts Trends and Revenue Analysis
                1. Revenue Forecasts
                2. Demand Analysis
                3. Revenue Forecasts
ATE for LRUs
                4. Revenue Forecasts
ATE for Depots
                5. End User Analysis
                6. Market and Technology Trends
        3. Competitive Structure and Market Share Analysis
                1. Competitive Structure
                2. Market Share Analysis
        4. Frost & Sullivan Awards
                1. Market Leadership Award
        5. Geographic Analysis
                1. Demand Analysis
                2. North America
                3. Europe
                4. Asia
Pacific
                5. Rest
of
World
5. Appendix
        1. Decision Support Database
                1. Military Expenditure
Equipment
                2. Military Expenditure As a Percentage of GDP
                3. Commercial Aircraft

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