Future of the Turkey Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022

  • ID: 4286391
  • Report
  • Region: Turkey
  • 134 Pages
  • Strategic Defence Intelligence
1 of 4

FEATURED COMPANIES

  • Aselsan
  • BAE Systems
  • Havelsan
  • Istanbul Shipyard
  • Lockheed Martin
  • Otokar
  • MORE

Summary

Turkish defense expenditure stands at US$10.6 Billion in 2017, and registered a compound annual growth rate (CAGR) of -7.49% during the historic period. The country’s strained relationship with Greece, persistent threats from the Kurdish Workers Party (PKK), active participation in peacekeeping missions, and the reduction in foreign dependency for military equipment procurement drove defense expenditure during the historic period. With this trend expected to continue, expenditure is anticipated to register a CAGR of 5.88% over the forecast period to value US$13.5 Billion in 2022.

Turkey’s defense expenditure will largely be driven by a dispute over territorial rights with Greece, security threats possessed by the Kurdish Workers’ Party (PKK), participation in peacekeeping missions, and the country’s focus on enhancing its defense export market while minimizing its foreign dependency for arms procurement. The country has no plans to decrease its defense budget and will increase its expenditure on procurement for the foreseeable future.

Turkish homeland security (HLS) expenditure, stands at US$1.5 Billion in 2017, and is projected to reach US$2.4 Billion in 2022, registering a CAGR of 9.02% over the forecast period. Expenditure is driven by the threat of separatists and extremists, illegal immigration, drug trafficking, and the country’s dispute with Syria. IS terrorist attacks also poses a major problem for the country’s security forces. The government is looking to boost investments in internal security services and intelligence to prevent attacks

Aircraft accounted for the largest expenditure during 2012-2016, with the US being the largest supplier. Turkish defense imports were highest in 2012 and 2014. In 2012,

Turkey procured Airborne Early Warning and Control (AEW&C) aircraft and in 2014 acquired 737-700 Peace Eagle Aircraft. Other significant import partners include South Korea, Spain, and Italy. Sensors, artillery, missiles, engines, naval vessels, naval weapons, armored vehicles and satellites were other key imports during 2012-2016.

The report “Future of the Turkey Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022” offers insights into the market opportunities and entry strategies adopted by foreign original equipment manufacturers (OEMs) to gain a market share in the Turkey defense industry.

In particular, this report offers in-depth analysis of the following:

  • Market opportunity and attractiveness: Detailed analysis of the current industry size and growth expectations during 2018-2022, including highlights of the key growth stimulators. It also benchmarks the industry against key global markets and provides a detailed understanding of emerging opportunities in specific areas.
  • Procurement Dynamics: Trend analysis of imports and exports, together with their implications and impact on the Turkey defense industry.
  • Industry structure: Five forces analysis to identify various power centers in the industry and how these are expected to develop in the future.
  • Market entry strategy: Analysis of possible ways to enter the market, together with detailed descriptions of how existing companies have entered the market, including key contracts, alliances, and strategic initiatives.
  • Competitive landscape and strategic insights: Analysis of the competitive landscape of the defense industry in Turkey, providing an overview of key defense companies (both domestic and foreign), together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Companies mentioned in this report: Howaldtswerke-Deutsche Werft, Lockheed Martin, BAE Systems, Otokar, Roketsan, Makina ve Kimya Endüstrisi Kurumu, Aselsan, Turkish Aerospace Industries, Havelsan, Tusas Engine Industries (TEI), FNSS Defense Systems Company and Istanbul Shipyard.

Scope

  • Turkish defense expenditure stands at US$10.6 billion in 2017, and registered a compound annual growth rate (CAGR) of -7.49% during the historic period. The country’s strained relationship with Greece, persistent threats from the Kurdish Workers Party (PKK), active participation in peacekeeping missions, and the reduction in foreign dependency for military equipment procurement drove defense expenditure during the historic period.. As a percentage of GDP, the country’s defense expenditure will average 1.3% over the forecast period compared to an average of 1.4% recorded during the historic period.
  • The capital expenditure allocation, which stood at an average of 26.1% during the historic period, is projected to slightly decrease to an average of 24.1% over the forecast period. This is primarily due to the procurement of advanced defense equipment and a focus on increasing the capabilities of the country’s indigenous defense industry. Various procurements that are expected to fuel the growth of capital spending over the forecast period include multi-role aircraft, missile defense systems, corvettes, and main battle tanks (MBTs). Consequently, the remaining budget will be allocated to revenue expenditure, which constitutes personnel salaries, development programs for military personnel, and training.
  • The MoD is expected to invest in fighters and Multi-role aircraft, Main Battle Tanks (MBT) and frigates.

Reasons to Buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of Turkey defense industry market trends for the coming five years
  • The market opportunity section will inform the user about the various military requirements that are expected to generate revenues during the forecast period. The description includes technical specifications, recent orders, and the expected investment pattern by the country during the forecast period
  • Detailed profiles of the top domestic and foreign defense manufacturers with information about their products, alliances, recent contract wins, and financial analysis wherever available. This will provide the user with a total competitive landscape of the sector
  • A deep qualitative analysis of Turkey defense industry covering sections including demand drivers, Porter’s Five Forces Analysis,  Key Trends and Growth Stimulators, and latest industry contracts
READ MORE
Note: Product cover images may vary from those shown
2 of 4

FEATURED COMPANIES

  • Aselsan
  • BAE Systems
  • Havelsan
  • Istanbul Shipyard
  • Lockheed Martin
  • Otokar
  • MORE

1. Introduction
1.1. What is this Report About?
1.2. Definitions
1.3. Summary Methodology
1.4. About

2. Executive Summary

3. Market Attractiveness and Emerging Opportunities
3.1. Current Market Conditions
3.1.1. Primary threat perception
3.1.2. Military doctrine and strategy
3.1.3. Military fleet size
3.1.4. Procurement Programs
3.1.4.1. Ongoing procurement programs
3.1.4.2. Future procurement programs
3.1.5. Social, political and economic environment and support for defense projects
3.1.6. Political and strategic alliances
3.2. Defense Market Size Historical and Forecast
3.2.1. Turkey defense expenditure expected to grow during the forecast period
3.2.2. Turkish defense expenditure to rise over the forecast period
3.2.3. Military expenditure as a percentage of GDP is expected to decline over the forecast period
3.3. Analysis of Defense Budget Allocation
3.3.1. Share of capital expenditure to increase over the forecast period
3.3.2. Capital expenditure to increase over the forecast period
3.3.3. Per capita defense expenditure to rise over the forecast period
3.4. Homeland Security Market Size and Forecast
3.4.1. Homeland security (HLS) expenditure expected to grow over the forecast period
3.4.2. Threats driving homeland security expenditure
3.4.3. Turkey faces a high level of terrorist threat
3.4.4. Turkey faces high level of threat from foreign terrorist organizations
3.4.5. Turkey has a terrorism index score of 6.7
3.5. Benchmarking with Key Global Markets
3.5.1. Turkish defense expenditure expected to remain low compared to leading spenders
3.5.2. The country’s defense budget is high compared to its regional countries
3.5.3. Turkey defense expenditure as a percentage of GDP is expected to decrease
3.6. Market Opportunities: Key Trends and Growth Stimulators
3.6.1. Multi-role aircraft
3.6.2. Main battle tanks (MBTs)
3.6.3. Naval vessels - frigates

4. Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense imports expected to decrease over the forecast period
4.1.2. The US was the primary supplier of arms to Turkey
4.1.3. Aircraft were the major imported military hardware during 2012-2016
4.2. Export Market Dynamics
4.2.1. Turkey aims to increase defense exports over the forecast period
4.2.2. Turkmenistan emerged as the largest importer of Turkish defense equipment during the period 2012-2016
4.2.3. Naval vessels accounted for the majority of defense exports during 2012-2016

5. Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining power of supplier: low
5.1.2. Bargaining power of buyer: high
5.1.3. Barrier to entry: medium
5.1.4. Intensity of rivalry: high
5.1.5. Threat of substitution: high

6. Market Entry Strategy
6.1. Market Regulation
6.1.1. The Turkish government encourages offsets to develop the country’s domestic industrial defense base
6.2. Market Entry Route
6.2.1. Budgeting Process
6.2.2. Procurement policy and process
6.2.3. Joint venture provides market entry opportunity for foreign OEMs
6.2.4. Joint research and development programs provide foreign OEMs with an opportunity for market entry
6.3. Key Challenges
6.3.1. Corruption poses a challenge to the success of defense deals
6.3.2. The completion of military modernization plans, project delays, and cost escalation to limit new projects

7. Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Foreign Companies
7.2.1. Howaldtswerke-Deutsche Werft (HDW): Overview
7.2.2. Howaldtswerke-Deutsche Werft: recent announcements and strategic initiatives:
7.2.3. Howaldtswerke-Deutsche Werft: Main Products and Services
7.2.4. Howaldtswerke-Deutsche Werft: alliances
7.2.5. Howaldtswerke-Deutsche Werft: recent contract wins
7.3.1. Lockheed Martin: overview
7.3.2. Lockheed Martin: Main Products and Services
7.3.3. Lockheed Martin: recent announcements and strategic initiatives:
7.3.4. Lockheed Martin: Alliances
7.3.5. Lockheed Martin: Recent Contract Wins
7.3.6. Lockheed Martin: Financial Analysis
7.3.7. BAE Systems: overview
7.3.8. BAE Systems: Main products
7.3.9. BAE Systems: recent announcements and strategic initiatives
7.3.10. BAE Systems: Alliances
7.3.11. BAE Systems: Recent Contract Wins
7.3.12. BAE Systems: Financial Analysis
7.4. Key Public Companies
7.4.1. Otokar: overview
7.4.2. Otokar: Main products
7.4.3. Otokar: recent announcements and strategic initiatives
7.4.4. Otokar: alliances
7.4.5. Otokar: recent contract wins
7.4.6. Otokar: Financial Analysis
7.4.7. Roketsan: overview
7.4.8. Roketsan: products and services
7.4.9. Roketsan: recent announcements and strategic initiatives.
7.4.10. Roketsan: alliances
7.4.11. Roketsan: recent contract wins
7.4.12. Makina ve Kimya Endüstrisi Kurumu (MKEK): overview
7.4.13. Makina ve Kimya Endüstrisi Kurumu (MKEK): products and services
7.4.14. Makina ve Kimya Endüstrisi Kurumu (MKEK): Alliances
7.4.15. Aselsan: overview
7.4.16. Aselsan: products and services
7.4.17. Aselsan: recent announcements and strategic initiatives
7.4.18. Aselsan: Alliances
7.4.19. Aselsan: recent contract wins
7.4.20. Aselsan: Financial Analysis
7.4.21. Turkish Aerospace Industries (TAI): overview
7.4.22. Turkish Aerospace Industries: products and services
7.4.23. Turkish Aerospace Industries: Recent Announcements and Strategic Initiatives
7.4.24. Turkish Aerospace Industries: Alliances
7.4.25. Turkish Aerospace Industries: Recent Contract Wins
7.4.26. Havelsan: overview
7.4.27. Havelsan: products
7.4.28. Havelsan: Recent announcements and Strategic Initiatives
7.4.29. Havelsan: Alliances
7.4.30. Havelsan: Recent contract wins
7.5. Key Private Sector Companies
7.5.1. Tusas Engine Industries (TEI): overview
7.5.2. Tusas Engine Industries: products and services
7.5.3. Tusas Engine Industries, Inc. (TEI): recent announcements and strategic initiatives
7.5.4. Tusas Engine Industries, Inc. (TEI): Alliances
7.5.5. Tusas Engine Industries, Inc. (TEI): Alliances
7.5.6. FNSS Defense Systems Co: overview
7.5.7. FNSS Defense Systems Co: Main Products and Services
7.5.8. FNSS Defense Systems Co: Recent announcements and strategic initiatives
7.5.9. FNSS Defense Systems: Alliances
7.5.10. FNSS Defense Systems Co: Recent Contract Wins
7.5.11. Istanbul Shipyard: Overview
7.5.12. Istanbul: products
7.5.13. Istanbul Shipyard: Recent announcements and strategic initiatives
7.5.14. Istanbul Shipyard: Recent contract wins

8. Business Environment and Country Risk
8.1. Economic Performance
8.1.1. GDP per capita
8.1.2. GDP, current prices
8.1.3. Export of goods and services (LCU billion)
8.1.4. Import of goods and services (LCU billion)
8.1.5. Gross national disposable income (US$ billion)
8.1.6. Local currency unit per US$
8.1.7. Market capitalization of listed companies
8.1.8. Market capitalization of listed companies as a percentage of GDP
8.1.9. Government cash surplus deficit as a percentage of GDP
8.1.10. Goods Exports as a percentage of GDP
8.1.11. Good imports as a percentage of GDP
8.1.12. Service imports as a percentage of GDP
8.1.13. Service exports as a percentage of GDP
8.1.14. Foreign direct investments
8.1.15. Net foreign direct investment as a percentage of GDP
8.1.16. Mining, manufacturing, utilities output

9. Appendix
9.1. About
9.2. Disclaimer

List of Tables

Table 1: Turkey - Army Strength
Table 2: Turkey - Navy Strength
Table 3: Turkey - Air Force Strength
Table 4: Turkey - Ongoing Procurement Programs
Table 5: Turkish Future Procurement Programs
Table 6: Turkey - Defense Expenditure (TRY Billion and US$ Billion), 2013-2022
Table 7: Turkey - GDP Growth vs Defense Expenditure According to Percentage of GDP Growth, 2013-2022
Table 8: Turkey - Defense Budget Split by Capital and Revenue Expenditure (%), 2013-2022
Table 9: Turkey - Defense Capital Expenditure (TRY Billion and US$ Billion), 2013-2022
Table 10: Turkey - Per Capita Defense Expenditure (US$), 2013-2022
Table 11: Turkey - Homeland Security Expenditure (TRY Billion and US$ Billion), 2013-2022
Table 12: Terrorism Index, 2017
Table 13: Benchmarking with Key Markets - 2013-2017 vs 2018-2022
Table 14: Turkey - Offset Regulations (%), 2017
Table 15: Turkey - Technological Cooperation, Investment, and R&D Multiplier Provision
Table 16: Multipliers for Export Related Systems
Table 17: Turkey - Budget Formation Timetable, 2017
Table 18: Turkey - Market Entry by Key Foreign Companies
Table 19: Turkey - Market Entry by Key Foreign Companies
Table 20: Turkey - Competitive Landscape of Defense Industry, 1976-2017
Table 21: Howaldtswerke-Deutsche Werft (HDW) - Main Products
Table 22: Howaldtswerke-Deutsche Werft - Alliances
Table 23: Howaldtswerke-Deutsche Werft (HDW) - Recent Contract Wins
Table 24: Lockheed Martin - Main Products
Table 25: Lockheed Martin - Alliances
Table 26: Lockheed Martin - Recent Contract Wins
Table 27: BAE Systems - Main Products
Table 28: BAE Systems - Alliances
Table 29: BAE Systems - Recent Contract Wins
Table 30: Otokar - Main Products
Table 31: Otokar - Alliances
Table 32: Otokar - Recent Contract Wins
Table 33: Roketsan - Main Products and Services
Table 34: Roketsan - Alliances
Table 35: Roketsan - Recent Contract Wins
Table 36: Makina ve Kimya Endüstrisi Kurumu (MKEK) - Main Products
Table 37: Makina ve Kimya Endüstrisi Kurumu (MKEK) - Alliances
Table 38: Aselsan - Main Products and Services
Table 39: Aselsan - Alliances
Table 40: Aselsan - Recent Contract Wins
Table 41: Turkish Aerospace Industries (TAI) - Main Products and Services
Table 42: Turkish Aerospace Industries (TAI) - Alliances
Table 43: Turkish Aerospace Industries (TAI) - Recent Contract Wins
Table 44: Havelsan - Main Products
Table 45: Havelsan - Alliances
Table 46: Havelsan - Recent Contract Wins
Table 47: Tusas Engine Industries, Inc. (TEI) - Main Products
Table 48: Tusas Engine Industries, Inc. (TEI) - Alliances
Table 49: Tusas Engine Industries, Inc. (TEI) - Recent Contract Wins
Table 50: FNSS Defense Systems Co - Main Products & Services
Table 51:Tusas Engine Industries, Inc. (TEI) - Alliances
Table 52: FNSS Defense Systems Co - Recent Contract Wins
Table 53: Istanbul Shipyard - Main Products
Table 54 Istanbul Shipyard - Recent Contract Wins

List of Figures

Figure 1: Turkey - Defense Expenditure (TRY Billion), 2013-2022
Figure 2: Turkish Defense Expenditure (US$ Billion), 2013-2022
Figure 3: Turkey - GDP Growth vs Defense Expenditure According to Percentage of GDP Growth, 2013-2022
Figure 4:Turkey - Defense Budget Split by Capital and Revenue Expenditure (%), 2013-2022
Figure 5: Turkey - Defense Capital Expenditure (TRY Billion), 2013-2022
Figure 6: Turkey - Defense Capital Expenditure (US$ Billion), 2013-2022
Figure 7: Turkish Per Capita Defense Expenditure (US$), 2013-2022
Figure 8: Turkey - Homeland Security Budget (TRY Billion), 2013-2022
Figure 9: Turkish Homeland Security Budget (US$ Billion), 2013-2022
Figure 10: Terrorism Heat Map, 2017
Figure 11: Terrorism Index, 2017
Figure 12: Benchmarking with Key Markets - 2013-2017 vs 2018-2022
Figure 13: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2017 and 2022
Figure 14: Defense Expenditure According to Percentage of GDP of Largest Military Spenders (%), 2017
Figure 15: Turkey - Multi-Role Aircraft Market Size (US$ Million), 2017-2027
Figure 16: Turkey - MBTs Market Size (US$ Million), 2017-2027
Figure 17: Turkey - Frigates Market Size (US$ Million), 2017-2027
Figure 18: Turkey - Defense Imports Trend (US$ Million), 2012-2016
Figure 19: Turkey - Defense Imports by Country (%), 2012-2016
Figure 20: Turkey - Defense Imports by Category (%), 2012-2016
Figure 21: Turkey - Defense Exports Trend, 2012-2016
Figure 22: Turkey - Defense Exports by Country (US$ Million), 2012-2016
Figure 23: Turkey - Defense Exports by Category (%), 2012-2016
Figure 24: Industry Dynamics Porter’s Five Forces Analysis
Figure 25: Lockheed Martin - Revenue Trend Analysis (%), 2012-2016
Figure 26: Lockheed Martin - Operating Profit Trend Analysis (%), 2012-2016
Figure 27: Lockheed Martin - Net Profit Trend Analysis (%), 2012-2016
Figure 28: BAE Systems - Revenue Trend Analysis (GBP Billion / %), 2012-2016
Figure 29: BAE Systems - Operating Profit Trend Analysis (GBP Billion / %), 2012-2016
Figure 30: BAE Systems - Net Profit Trend Analysis (GBP Billion / %), 2012-2016
Figure 31: Otokar - Revenue Trend Analysis, FY2012-2016
Figure 32: Otokar - Operating Profit Trend Analysis, FY2012-2016
Figure 33: Otokar - Net Profit Trend Analysis, FY2012-2016
Figure 34: Aselsan - Revenue Trend Analysis (%), 2012-2016
Figure 35: Aselsan - Operating Profit Trend Analysis (%), 2012-2016
Figure 36: Aselsan - Net Profit Trend Analysis (%), 2012-2016
Figure 37: Turkey - GDP Per Capita (US$), 2015-2025
Figure 38: Turkey - GDP Current Prices (US$ Billion), 2015-2025
Figure 39: Turkey - Export of Goods and Services (LCU Billion), 2005-2014
Figure 40: Turkey - Import of Goods and Services (LCU Billion), 2005-2014
Figure 41: Turkey - Gross National Disposable Income (US$ Billion), 2005-2012
Figure 42: Turkey - LCU per US$, 2015-2024
Figure 43: Turkey - Market Capitalization of Listed Companies (US$ Billion), 2005-2012
Figure 44: Turkey - Market Capitalization of Listed Companies (Percentage of GDP), 2005-2012
Figure 45: Turkey - Cash Surplus Deficit as (Percentage of GDP), 2008-2012
Figure 46: Turkey - Good Exports as a Percentage of GDP, 2005-2014
Figure 47: Turkey - Good Imports as a Percentage of GDP, 2005-2014
Figure 48: Turkey - Service Imports as a Percentage of GDP, 2005-2014
Figure 49: Turkey - Service Exports as a Percentage of GDP, 2005-2014
Figure 50: Turkey - Foreign Direct Investments (BoP, Current US$ Billion), 2005-2014
Figure 51: Turkey - Net Foreign Direct Investment as a Percentage of GDP, 2005-2014
Figure 52: Turkey - Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014

Note: Product cover images may vary from those shown
3 of 4

Loading
LOADING...

4 of 4
  • Aselsan
  • BAE Systems
  • FNSS Defense Systems Company
  • Havelsan
  • Howaldtswerke-Deutsche Werft
  • Istanbul Shipyard
  • Lockheed Martin
  • Makina ve Kimya Endüstrisi Kurumu
  • Otokar
  • Roketsan
  • Turkish Aerospace Industries
  • Tusas Engine Industries (TEI)
Note: Product cover images may vary from those shown
5 of 4
Note: Product cover images may vary from those shown
Adroll
adroll