Aerospace and Defense Global Market Opportunities and Strategies to 2032

This report describes and explains the aerospace and defense market and covers 2017-2022, termed the historic period, and 2022-2027 termed the forecast period, along with further forecasts for the period 2027-2032. The report evaluates the market across each region and for the major economies within each region.

The global aerospace and defense market grew from $806.89 billion in 2022, having increased at a compound annual growth rate (CAGR) of 2.6% since 2017. The market is expected to grow from $806.89 billion in 2022 to $1,139.41 billion in 2027 at a rate of 7.1%. The market is then expected to grow at a CAGR of 5.2% from 2027 and reach $1,467.80 billion in 2032.

Growth in the historic period resulted from emerging markets growth, the increased demand for air travel, the increasing military expenditure, the increasing use of military drones and the increasing development of autonomous fighter jets. Factors that negatively affected growth in the historic period were the shortage of skilled labor, volatile raw material prices, the grounding of airplanes, the COVID-19 impact and geopolitical tensions.

Going forward, government support, the rising urbanization, the increasing use of lightweight materials, commercial use of drones, the increasing demand for military helicopters and the increasing military modernization programs will drive the market growth. Factors that could hinder the growth of the aerospace and defense market in the future include budget airlines’ bankruptcy, the Russia-Ukraine war impact, the increased cyber-attacks and the stringent regulations.

The aerospace and defense market is segmented by type into aerospace and defense. The defense market was the largest segment of the aerospace and defense market by type, accounting for $531.28 billion or 65.8% of the total market in 2022. The aerospace market is expected to be the fastest-growing segment going forward at a CAGR of 9.3%.

The aerospace market is segmented by type into commercial aircraft, aircraft maintenance, repair and overhauling services and aerospace support and auxiliary equipment. The commercial aircraft market was the largest segment of the aerospace market by type, accounting for $182.43 billion or 66.2% of the total market in 2022. The aircraft maintenance, repair and overhauling services market is expected to be the fastest-growing segment going forward at a CAGR of 10.5%.

The defense market is segmented by type into air based defense equipment, sea based defense equipment, land based defense equipment, defense equipment maintenance, repair and overhauling services and defense support and auxiliary equipment. The air based defense equipment market was the largest segment of the defense market by type, accounting for $201.18 billion or 37.9% of the total market in 2022. The sea based defense equipment market is expected to be the fastest-growing segment going forward at a CAGR of 7.4%.

The aerospace and defense market is also segmented by operation into autonomous and manual. The manual market was the largest segment of the aerospace and defense market by operation, accounting for $759.61 billion or 94.1% of the total market in 2022. The autonomous market is expected to be the fastest-growing segment going forward at a CAGR of 10.2%.

The aerospace and defense market is also segmented by components into weapon system, fire control system, command and control system and other components. The other components market was the largest segment of the aerospace and defense market by components, accounting for $155.86 billion or 19.3% of the total market in 2022. The other components market is expected to be the fastest-growing segment going forward at a CAGR of 7.3%.

North America was the largest region in the aerospace and defense market, accounting for 33.0% of the global market in 2022. It was followed by Asia Pacific, Western Europe and the other regions. Going forward, the fastest growing regions in the aerospace and defense market will be the Middle East and the Western Europe, where growth will be at CAGRs of 10.6% and 7.9% respectively from 2022-2027.

The global aerospace and defense market is slightly concentrated, with large players. The top ten competitors in the market made up to 51.04% of the total market in 2022. Airbus Group SE was the largest competitor with 8.60% share of the market, followed by Lockheed Martin Corporation with 7.97%, Raytheon Technologies Corporation with 7.84%, The Boeing Company with 7.60%, Northrop Grumman Corp with 4.54%, General Dynamics with 3.34%, General Electric Company with 3.23%, Bae Systems plc with 3.11%, Safran SA with 2.79%, and Thales with 2.03%.

The top opportunities in the aerospace and defense market by type will arise in the defense market, which will gain $177.5 billion of global annual sales by 2027. The top opportunities in the aerospace market by type will arise in the commercial aircraft market, which will gain $105.6 billion of global annual sales by 2027. The top opportunities in the defense market by type will arise in the air based defense equipment market, which will gain $73.9 billion of global annual sales by 2027. The top opportunities in the aerospace and defense market by operation will arise in the manual market, which will gain $302.8 billion of global annual sales by 2027. The top opportunities in the aerospace and defense market by components will arise in other components market, which will gain $65.9 billion of global annual sales by 2027. The aerospace and defense market size will gain the most in the USA at $87.9 billion.

Market-trend-based strategies for the aerospace and defense market include drone manufacturers adopting 3D printing technology, digital thread and digital twin to improve performance, collaborations and acquisitions, cloud-based technology, design upgradations and modularity for military-style weapons, use of artificial intelligence (AI), day/night decamouflage technology for light weapons, aircraft health monitoring system (AHMS) to enhance maintenance and repair process efficiency, edge computing in defense, the adoption of unmanned combat vehicles, augmented and virtual reality, laser technology in aerospace and defense, robotics and UAVs to shorten maintenance time, companies investing in electricity run aircrafts and focus on blockchain to shape aircraft manufacturing.

Player-adopted strategies in the aerospace and defense industry include enhancing operational capabilities through strategic collaborations and partnerships, strengthening business operations through securing new contracts and strengthening business capabilities through the launch of new products and solutions.

To take advantage of the opportunities, the publisher recommends the aerospace and defense companies to focus on augmented reality (AR) and virtual reality (VR), focus on laser technology in aerospace and defense, focus on artificial intelligence (AI), focus on cloud technology, focus on 3D printing technology in drone manufacturing, focus on digital thread and digital twin, focus on design upgradations and modularity for military-style weapons, focus on day/night decamouflage technology for light weapons, focus on aircraft health monitoring system (AHMS), focus on edge computing in defense, focus on adopting unmanned combat vehicles, focus on adopting robotics and UAVS (unmanned aerial vehicles), focus on adopting electricity run aircrafts, focus on blockchain to shape aircraft manufacturing, expand in emerging markets, continue to focus on developed markets, focus on strategic partnerships and collaborations, provide competitively priced offerings, participate in trade shows and events, continue to use B2B promotions, continue to focus on fast-growing defense equipment types, increase focus on governments and focus on the urban population.