Future of the Romanian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

  • ID: 4483694
  • Report
  • Region: Romania
  • 135 pages
  • Strategic Defence Intelligence
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Romania’s Defense Expenditure is Anticipated to Cumulatively Value Close to US$30 Billion during 2019-2023

FEATURED COMPANIES

  • Aerostar SA
  • Avioane Craiova SA
  • CN Romarm SA
  • Electromagnetica SA
  • Elprof SA
  • IAR SA Brasov
  • MORE

Future of the Romanian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

Summary

Romania’s ongoing modernization of the country’s armed forces to meet NATO standards, along with its participation in international peacekeeping missions, drove Romania’s defense expenditure during the historic period. With this trend expected to continue over the forecast period, the country’s defense expenditure is anticipated to cumulatively value close to US$30 billion during 2019-2023. The defense budget as a percentage of GDP is expected to increase slightly in the forecast period.

Romania’s capital expenditure allocation is expected to significantly increase during 2019-2023, primarily due to the procurement of additional F-16 multirole aircraft, multirole aircraft MRO, a HIMARS rocket artillery system, a Patriot missile defense system, corvettes, 8X8 armored vehicles, and submarines. The government’s focus on its modernization plans, which require the procurement of more advanced military equipment with improved technology, is expected to drive capital expenditure over the forecast period. Revenue expenditure is also projected to increase over the forecast period at a CAGR of over 8.8%, which will be directed towards additional recruitment, training, and development programs for military personnel.

Aircraft accounted for the majority of Romania’s imports during 2012-2016, with Portugal being the largest supplier. The country acquired C-27J tactical transport aircraft and F-16 AM/BM Fighting Falcons. Sensors, armored vehicles, engines, and missiles were the other imports during 2012-2016, with Italy, the US, Switzerland and France being the other significant suppliers. However, the forecast period is not expected to witness any significant increase in the country’s imports. Instead, Romania will boost defense procurements steadily over the forecast period.

This report "Future of the Romanian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023" offers detailed analysis of the Romanian defense industry with market size forecasts covering the next five years. This report will also analyze factors that influence demand for the industry, key market trends, and challenges faced by industry participants.

In particular, it provides an in-depth analysis of the following -

  • The Romanian defense industry market size and drivers: detailed analysis of the Romanian defense industry during 2019-2023, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the country’s expenditure and modernization patterns
  • Budget allocation and key challenges: insights into procurement schedules formulated within the country and a breakdown of the defense budget. It also details the key challenges faced by defense market participants within the country
  • Porter’s Five Force analysis of the Romanian defense industry: analysis of the market characteristics by determining the bargaining power of suppliers, bargaining power of buyers, threat of substitution, intensity of rivalry, and barriers to entry
  • Import and Export Dynamics: analysis of prevalent trends in the country’s imports and exports over the last five years
  • Market opportunities: details of the top five defense investment opportunities over the next 10 years
  • Competitive landscape and strategic insights: analysis of the competitive landscape of the Romanian defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis

Companies Mentioned - CN Romarm SA, S.C. Uzina Mecanica Cugir SA, Aerostar SA, IAR SA Brasov, Turbomecanica SA, Electromagnetica SA, Avioane Craiova SA, Elprof SA, IOR SA, Simultec SRL,Lockheed Martin Corporation (Lockheed Martin), General Dynamics European Land Systems (GDELS), Iveco, Intelcan Technosystems, Inc and Airbus Helicopters Romania

Scope

  • The Romanian defense budget is valued at US$4.8 billion in 2018 and registered a CAGR of 23.57% during the historic period. The ongoing modernization of the country’s armed forces to meet NATO standards, along with its participation in international peacekeeping missions, drove Romania’s defense expenditure during the historic period.
  • With this trend expected to continue over the forecast period, the country’s defense expenditure is anticipated to cumulatively value US$31.3 billion during 2019-2023. The defense budget as a percentage of GDP is expected to increase slightly, from an average of 1.5% during the historic period to 2.2% during 2019-2023.
  • The Romanian Ministry of Defence (MoD) allocated an average of 32.6% to capital expenditure during 2014-2018, and this is expected to increase over the forecast period to reach 41.7%. Currently, due to the austerity measures, the government is focusing on the acquisition of high-quality second-hand equipment to save costs.
  • Its military modernization programs include the procurement of 12 second hand ex-Portuguese F-16 fighters, Piranha V armored vehicles, air defense radars, and surface to air missile systems, among others. Furthermore, under the soldier modernization program, “Warrior 2020”, the army plans to procure communications, automatic mortars, C4I subsystems, lightweight superior ballistic protection, and smart munitions systems to create a mobile force.
  • The MoD is expected to invest in Land-based C4ISR, Military IT-Networking and Maritime Surveillance and Detection.

Reasons to buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Romanian 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 the Romanian defense industry covering sections including demand drivers, Porter’s Five Forces Analysis, Key Trends and Growth Stimulators, and latest industry contracts
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FEATURED COMPANIES

  • Aerostar SA
  • Avioane Craiova SA
  • CN Romarm SA
  • Electromagnetica SA
  • Elprof SA
  • IAR SA Brasov
  • MORE

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

2. Executive Summary

3. Market Attractiveness and Emerging Opportunities
3.1. Current Market Scenario
3.1.1. Primary Threat Perception
3.1.2. Military Doctrine & Strategy
3.1.3. Military Fleet Size
3.1.4. Procurement Programs

  • Ongoing Procurement Programs
  • Future Procurement Programs
  • Top Procurement Programs by Value (US$ Million) 2018-2023

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. Romanian defense expenditure to register a CAGR of 10.15% over the forecast period
3.2.2. The country’s modernization efforts, to meet NATO standards, and its participation in peacekeeping missions will support defense expenditure
3.3. Analysis of Defense Budget Allocation
3.3.1. Romania’s defense expenditure as a percentage of GDP is projected to increase over the forecast period
3.3.2. Capital expenditure allocation expected to increase during the forecast period
3.3.3. Capital expenditure expected to grow at a CAGR of 12.05% over the forecast period
3.3.4. Per capita defense expenditure forecast to grow over the forecast period
3.4. Homeland Security Market Size and Forecast
3.4.1. Homeland security budget projected to grow steadily during the forecast period
3.4.2. Border control measures and cybercrime to drive homeland security budget
3.4.3. The nation is at ‘some risk’ of terrorism
3.4.4. Romania faces some level of threat from foreign terrorist organizations
3.4.5. Romania has a terrorism index score of 0.0
3.5. Benchmarking with Key Global Markets
3.5.1. Romania’s defense budget to increase at a CAGR of 10.15% during the forecast period
3.5.2. Romanian defense expenditure is expected to remain low compared to other leading spenders
3.5.3. The country allocates a lower percentage of GDP towards defense as compared to other top defense spenders globally
3.6. Market Opportunities: Key Trends and Growth Stimulators
3.6.1. Top Defense Market Sectors by Value (US$ Million) - Projections over 2018-2023
3.6.2. Land Based C4ISR
3.6.3. Military IT-Networking
3.6.4. Maritime Surveillance and Detection

4. Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense imports registered an increasing trend during 2013-2017
4.1.2. Romania sourced most of its arms from Portugal
4.1.3. Aircraft and sensors accounted for most of arms imports during 2013-2017
4.2. Export Market Dynamics
4.2.1. Defense exports are forecast to grow during the forecast period
4.2.2. Romania supplies most of its defense equipment to the Netherlands
4.2.3. Naval vessels are the most exported defense goods

5. Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining Power of Supplier: Low to Medium
5.1.2. Bargaining Power of Buyer: High
5.1.3. Barrier to Entry: Medium
5.1.4. Intensity of Rivalry: Medium to High
5.1.5. Threat of Substitution: Medium to High

6. Market Entry Strategy
6.1. Market Regulation
6.1.1. Offset policy mandates suppliers invest a minimum of 80% of the contract value into the Romanian economy
6.1.2. Romania allows 100% foreign direct investment in the defense sector
6.2. Market Entry Route
6.2.1. Budgeting Process
6.2.2. Procurement Policy and Process
6.2.3. Foreign OEMs enter the market through the acquisition of domestic defense companies
6.2.4. EDA promotes defense procurements within the EU
6.3. Key Challenges
6.3.1. Rampant corruption and inadequate legal infrastructure
6.3.2. Low defense budget weighs down market prospects

7. Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Domestic Companies
7.2.1. CN Romarm SA: Overview
7.2.2. CN Romarm SA: Product Focus
7.2.3. CN Romarm SA: Recent Announcements and Strategic Initiatives
7.2.4. CN Romarm SA: Alliances
7.2.5. CN Romarm SA: Recent Contract Wins
7.2.6. S.C. Uzina Mecanica Cugir S.A: Overview
7.2.7. S.C. Uzina Mecanica Cugir S.A: Product Focus
7.2.8. S.C. Uzina Mecanica Cugir S.A: Recent Announcements and Strategic Initiatives
7.2.9. Aerostar S.A.: Overview
7.2.10. Aerostar S.A.: Products
7.2.11. Aerostar S.A.: Recent Announcements and Strategic Initiatives
7.2.12. Aerostar S.A.: Alliances
7.2.13. Aerostar S.A.: Recent Contract Wins
7.2.14. Aerostar S.A.: Financial Analysis
7.2.15. IAR S.A. Brasov: Overview
7.2.16. IAR S.A. Brasov: Products and Services
7.2.17. IAR S.A. Brasov: Recent Announcements and Strategic Initiatives
7.2.18. IAR S.A. Brasov: Recent Contract Wins
7.2.19. IAR S.A. Brasov: Financial Analysis
7.2.20. Turbomecanica S.A.: Overview
7.2.21. Turbomecanica S.A.: Product Focus
7.2.22. Turbomecanica S.A.: Recent Announcements and Strategic Initiatives
7.2.23. Turbomecanica S.A.: Financial Analysis
7.2.24. Electromagnetica S.A.: Overview
7.2.25. Electromagnetica S.A.: Product Focus
7.2.26. Electromagnetica S.A.: Recent Announcements and Strategic Initiatives
7.2.27. Electromagnetica S.A.: Financial Analysis
7.2.28. Avioane Craiova S.A.: Overview
7.2.29. Avioane Craiova S.A. (SAIC): Product Focus
7.2.30. Avioane Craiova S.A: Recent Announcements and Strategic Initiatives
7.2.31. Avioane Craiova S.A: Alliances
7.2.32. Avioane Craiova S.A: Recent Contract Wins
7.2.33. Elprof S.A: Overview
7.2.34. Elprof S.A.: Product Focus
7.2.35. Elprof S.A.: Recent Announcements and Strategic Initiatives
7.2.36. Elprof S.A.: Recent Contract Wins
7.3. Domestic Private Companies
7.3.1. IOR S.A.: Overview
7.3.2. IOR S.A.: Product Focus
7.3.3. IOR S.A: Recent Announcements and Strategic Initiatives
7.3.4. Simultec S.R.L: Overview
7.3.5. Simultec S.R.L: Product Focus
7.3.6. Simultec S.R.L: Recent Announcements and Strategic Initiatives
7.3.7. Simultec S.R.L: Recent Contract Wins
7.4. Foreign Private Companies
7.4.1. Lockheed Martin: overview
7.4.2. Lockheed Martin: main products and services
7.4.3. Lockheed Martin: recent announcements and strategic initiatives
7.4.4. Lockheed Martin: alliances
7.4.5. Lockheed Martin: recent contract wins
7.4.6. Lockheed Martin Corp.: financial analysis
7.4.7. General Dynamics European Land Systems (GDELS): Overview
7.4.8. General Dynamics European Land Systems (GDELS): Defense Products
7.4.9. General Dynamics European Land Systems (GDELS): Recent Announcements and Strategic Initiatives
7.4.10. General Dynamics European Land Systems (GDELS): Alliances
7.4.11. General Dynamics European Land Systems (GDELS): Recent Contract Wins
7.4.12. Iveco: Overview
7.4.13. Iveco: Defense Products
7.4.14. Iveco: Recent Announcements and Strategic Initiatives
7.4.15. Iveco: Alliances
7.4.16. Iveco: Recent Contract Wins
7.4.17. Intelcan Technosystems, Inc.: Overview
7.4.18. Intelcan Technosystems, Inc.: Product Focus
7.4.19. Intelcan Technosystems, Inc.: Recent Announcements and Strategic Initiatives
7.4.20. Intelcan Technosystems Inc.: Recent Contract Wins
7.4.21. Airbus Helicopters Romania: Overview
7.4.22. Airbus Helicopters Romania: Products and Services
7.4.23. Airbus Helicopters Romania: Recent Announcements and Strategic Initiatives
7.4.24. Airbus Helicopters Romania: 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. Exports of Goods and Services (LCU Bn)
8.1.4. Imports of Goods and Services (LCU Bn)
8.1.5. Gross National Disposable Income (US$ Bn)
8.1.6. Local Currency Unit per US$
8.1.7. Market Capitalization of Listed Companies
8.1.8. Market Capitalization of Listed Companies (% 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. Goods 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. Net Foreign Direct Investment (US$ Bn)
8.1.15. Net Foreign Direct Investment as a Percentage of GDP
8.1.16. Mining, Manufacturing, Utilities Output

9. Appendix
9.1. About the Author
9.2. Disclaimer

List of Tables
Table 1: Romanian Army Strength
Table 2: Romanian Navy Strength
Table 3: Romania Air Force Strength
Table 4: Romanian Ongoing Procurement Programs
Table 5: Romanian Future Procurement Programs
Table 6: Top Romanian Defense Procurement Programs by Value (US$ Million) 2018-2023
Table 7: Romanian Defense Expenditure (RON Billion & US$ Billion), 2014-2023
Table 8: Romanian GDP Growth vs. Defense Expenditure as a Percentage of GDP Growth, 2014-2023
Table 9: Romanian Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023
Table 10: Romanian Defense Capital Expenditure (RON Billion & US$ Billion), 2014-2023
Table 11: Romanian Per Capita Defense Expenditure (US$), 2014-2023
Table 12: Romanian Homeland Security Expenditure (RON Billion & US$ Billion), 2014-2023
Table 13: Terrorism Index, 2018
Table 14: Benchmarking with Key Markets: 2014-2018 vs. 2019-2023
Table 15: Top Romanian Defense Market Sectors by Value (US$ Million) - 2018-2023
Table 16: Offset Regulations in Romania
Table 17: Romanian Budget Formation Timetable:
Table 18: Market Entry Strategies by Key Foreign Companies
Table 19: Top Defense Suppliers in Romanian Defense Industry - By Value (US$ Million) 2018-2023
Table 20: Competitive Landscape of the Romanian Defense Industry
Table 21: CN Romarm SA - Product Focus
Table 22: CN Romarm SA - Alliances
Table 23: CN Romarm SA. - Recent Contract Wins
Table 24: S.C. Uzina Mecanica Cugir S.A - Product Focus
Table 25: Aerostar S.A - Product Focus
Table 26: Aerostar S.A - Alliances
Table 27: Aerostar - Recent Contract Wins
Table 28: IAR S.A. Brasov - Products and Services
Table 29: IAR S.A. Brasov - Recent Contract Wins
Table 30: Turbomecanica S.A. - Product Focus
Table 31: Electromagnetica S.A. - Product Focus
Table 32: Avioane Craiova S.A. - Product Focus
Table 33: Avioane Craiova S.A. - Alliances
Table 34: Avioane Craiova S.A. - Recent Contract Wins
Table 35: Elprof S.A. - Product Focus
Table 36: Avioane Craiova S.A. - Recent Contract Wins
Table 37: IOR S.A. - Product Focus
Table 38: Simultec S.R.L - Product Focus
Table 39: Simultec S.R.L - Recent Contract Wins
Table 40: Lockheed Martin, Main Products
Table 41: Lockheed Martin, Alliances
Table 42: Lockheed Martin, Recent Contract Wins
Table 43: General Dynamics European Land Systems (GDELS) - Key Products
Table 44: General Dynamics European Land Systems (GDELS) - Alliances
Table 45: General Dynamics European Land Systems (GDELS) - Recent Contract Wins
Table 46: Iveco - Key Products and Services
Table 47: Iveco - Alliances
Table 48: Iveco - Recent Contract Wins
Table 49: Intelcan Technosystems, Inc. - Product Focus
Table 50: Intelcan Technosystems, Inc. - Recent Contract Wins
Table 51: Airbus Helicopters Romania - Products and Services
Table 52: Airbus Helicopters Romania - Recent Contract Wins

List of Figures
Figure 1: Romanian Defense Expenditure (RON Billion), 2014-2023
Figure 2: Romanian Defense Expenditure (US$ Billion), 2014-2023
Figure 3: Romanian GDP Growth vs. Defense Expenditure as a Percentage of GDP, 2014-2023
Figure 4: Romanian Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023
Figure 5: Romanian Capital Budget Allocation (RON Billion), 2014-2023
Figure 6: Romanian Capital Budget Allocation (US$ Billion), 2014-2023
Figure 7: Romanian Per Capita Defense Expenditure (US$), 2014-2023
Figure 8: Romanian Homeland Security Expenditure (RON Billion), 2014-2023
Figure 9: Romanian Homeland Security Expenditure (US$ Billion), 2014-2023
Figure 10: Terrorism Heat Map, 2018
Figure 11: Terrorism Index, 2018
Figure 12: Benchmarking with the World’s Largest and Top Regional Defense Spenders (US$ Billion), 2018 and 2023
Figure 13: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2018 and 2023
Figure 14: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2018
Figure 15: Land Based C4ISR Market Size (US$ Million), 2018-2023
Figure 16: Military IT-Networking Market Size (US$ Million), 2018-2023
Figure 17: Maritime Surveillance and Detection Market Size (US$ Million), 2018-2023
Figure 18: Romanian Defense Procurements in Terms of Their Supplier Relationships
Figure 19: Romanian Defense Import Trend (US$ Million), 2013-2017
Figure 20: Romanian Defense Imports by Country (%), 2013-2017
Figure 21: Romanian Defense Imports by Category (%), 2013-2017
Figure 22: Romanian Defense Exports (US$ Million), 2013-2017
Figure 23: Industry Dynamics - Porter’s Five Forces Analysis
Figure 24: Aerostar S.A. - Revenue Trend Analysis (RON Million), 2012-2016
Figure 25: Aerostar S.A. - Operating Profit Trend Analysis (RON Million), 2012-2016
Figure 26: Aerostar S.A. - Net Profit Trend Analysis (RON Million), 2012-2016
Figure 27: IAR S.A. Brasov - Revenue Trend Analysis (RON Million), 2012-2016
Figure 28: IAR S.A. Brasov - Operating Profit Trend Analysis (RON Million), 2012-2016
Figure 29: IAR S.A. Brasov - Net Profit Trend Analysis (RON Million), 2012-2016
Figure 30: Turbomecanica S.A. - Revenue Trend Analysis (RON Million), 2012-2016
Figure 31: Turbomecanica S.A. - Operating Profit Trend Analysis (RON Million), 2012-2016
Figure 32: Turbomecanica S.A. - Net Profit Trend Analysis (RON Million), 2012-2016
Figure 33: Electromagnetica SA - Revenue Trend Analysis (RON Million), 2012-2016
Figure 34: Electromagnetica S.A. - Operating Profit Trend Analysis (RON Million), 2012-2016
Figure 35: Electromagnetica S.A. - Net Profit Trend Analysis (RON Million), 2012-2016
Figure 36: Lockheed Martin Corp. - Revenue Trend Analysis (US$ billion), 2013-2017
Figure 37: Lockheed Martin Corp. - Operating Profit Trend Analysis (US$ billion), 2013-2017
Figure 38: Lockheed Martin Corp. - Net Profit Trend Analysis (US$ billion), 2013-2017
Figure 39: Romanian GDP Per Capita, 2015-2025
Figure 40: Romanian GDP, Current Prices (US$ Billion), 2015-2025
Figure 41: Romanian Export of Goods and Services (LCU Bn), 2005-2014
Figure 42: Romanian Imports of Goods and Services (LCU Bn), 2005-2014
Figure 43: Gross National Disposable Income (US$ Bn), 2005-2014
Figure 44: Local Currency per US$, 2015-2024
Figure 45: Romanian Market Capitalization of Listed Companies (US$ Billion), 2005-2012
Figure 46: Romanian Market Capitalization of Listed Companies (% of GDP), 2005-2012
Figure 47: Romanian Government Cash Surplus/Deficit as a % of GDP, 2005-2012
Figure 48: Romanian Goods Exports as a % of GDP, 2005-2014
Figure 49: Romanian Goods Imports as a % of GDP, 2005-2014
Figure 50: Romanian Service Imports as a % of GDP, 2005-2014
Figure 51: Romanian Service Exports as a % of GDP, 2005-2014
Figure 52: Romanian Net Foreign Direct Investment (US$ Billion), 2005-2014
Figure 53: Romanian Net Foreign Direct Investment as a % of GDP, 2005-2014
Figure 54: Romanian Mining, Manufacturing, Utilities Output (US$ Billion), 2005-2014

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  • Aerostar SA
  • Airbus Helicopters Romania
  • Avioane Craiova SA
  • CN Romarm SA
  • Electromagnetica SA
  • Elprof SA
  • General Dynamics European Land Systems (GDELS)
  • IAR SA Brasov
  • IOR SA
  • Intelcan Technosystems, Inc
  • Iveco
  • Lockheed Martin Corporation (Lockheed Martin)
  • S.C. Uzina Mecanica Cugir SA
  • Simultec SRL
  • Turbomecanica SA
Note: Product cover images may vary from those shown
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