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

  • ID: 4557655
  • Report
  • Region: Australia
  • 129 Pages
  • Strategic Defence Intelligence
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Australia Cumulatively Spent US$5.6 billion on Military Hardware and this Trend is Expected to Continue During the Forecast Period

FEATURED COMPANIES

  • Austal Ltd
  • Boeing Defense Australia
  • Lockheed Martin Australia
  • Navantia
  • Raytheon Australia
  • Saab Systems
  • MORE

Australia’s defense budget recorded a CAGR of 0.56% during the historic period, from US$27.2 billion in 2014 to US$27.8 billion in 2018. Modernization initiatives and advanced equipment procurement programs - as outlined in white papers published by the Australian Department of Defence (DoD) - will drive expenditure. According to one white paper, the country is expected to undertake a number of modernization and procurement programs over the coming decade. Participation in a number of UN peacekeeping operations will also fuel the country’s defense expenditure, propelling the budget at a CAGR of 8.10% till 2023.

In a bid to modernize its armed forces, the DoD will increase its capital expenditure allocation from 32.6% in 2019 to 37.9% in 2023. Cumulatively, capital expenditure will value US$61.9 billion over the forecast period and Revenue expenditure will record a CAGR of 5.88% till 2023.

During 2013-2017, Australia cumulatively spent US$5.6 billion on military hardware imports. Over the forecast period, this trend will continue. Key procurements will include F-35As, MH-60R Seahawk Romeo maritime combat helicopters, AIM 9X-2 Sidewinder missiles, nuclear attack submarines, surface combatants, surface vessels, and various armored vehicles.

The Australian Government invested a cumulative amount of US$131 billion into the defense industry. The higher rate of expenditure will be triggered by plans to procure new arms and ammunition to replace defunct stock, and to lend greater assistance to allied troops in the war against terror. As a percentage of GDP, military expenditure is anticipated to be capped at an average of 1.9% over the forecast period. Australia’s defense market offers numerous opportunities for both domestic and foreign manufacturers; as one of the largest defense equipment markets in the world, the country is expected to spend US$61.9 billion on capital expenditure over the forecast period.

The report ""Future of the Australian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023"" offers detailed analysis of the Australian defense industry with market size forecasts covering the next five years.

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

  • The Australian defense industry market size and drivers
  • Budget allocation and key challenges
  • Import and Export Dynamics
  • Market opportunities
  • Competitive landscape and strategic insights

Companies mentioned in this report: Thales Australia, Boeing Defense Australia, Lockheed Martin Australia, Raytheon Australia, Austal Ltd, Saab Systems, General Dynamics Land Systems Australia, Navantia, Airbus Group Australia Pacific, ASC.

Scope

  • The government remains committed to building strong defense capabilities. Australia’s defense budget recorded a CAGR of 0.56% during the historic period, from US$27.2 billion in 2014 to US$27.8 billion in 2018.
  • Modernization initiatives and advanced equipment procurement programs - as outlined in white papers published by the Australian Department of Defence (DoD) - will drive expenditure.
  • According to one white paper, the country is expected to undertake a number of modernization and procurement programs over the coming decade. Participation in a number of UN peacekeeping operations will also fuel the country’s defense expenditure, propelling the budget from US$29 billion in 2019 to US$39.7 billion in 2023, at a CAGR of 8.10%

Reasons to buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Australian 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
  • Profiles of the top domestic and foreign defense manufacturers . This will provide the user with a total competitive landscape of the sector
  • A deep qualitative analysis of the Australian defense industry covering sections including demand drivers, Key Trends , and latest industry contracts.
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FEATURED COMPANIES

  • Austal Ltd
  • Boeing Defense Australia
  • Lockheed Martin Australia
  • Navantia
  • Raytheon Australia
  • Saab Systems
  • MORE

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

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 and strategy
3.1.3. Military Fleet Size
3.1.4. Procurement programs
3.1.5. Ongoing procurement programs
3.1.6. Future procurement programs
3.1.7. Top Procurement Programs by Value (US$ Million) 2018-2023
3.1.8. Social, political and economic environment and support for defense projects
3.1.9. Political and strategic alliances
3.2. Defense Market Size Historical and Forecast
3.2.1. The Australian defense budget is set to post a CAGR of 8.10% over the forecast period
3.2.2. Military modernization and participation in peacekeeping missions are the factors driving the Australian defense industry
3.2.3. Australian defense budget as a percentage of GDP will remain at an average of 1.94% over the forecast period
3.3. Analysis of Defense Budget Allocation
3.3.1. Capital expenditure share to increase over the forecast period
3.3.2. Capital expenditure to post a forecast-period CAGR of 12.31%
3.3.3. Much of the defense budget is allocated to cyberspace and space-related security operations
3.3.4. The other segment to account for the majority share of Australia’s defense budget
3.3.5. Per capita defense expenditure to increase over the forecast period
3.4. Homeland Security Market Size and Forecast
3.4.1. Measures to curb organized crime, cyberattacks, and maritime threats to drive homeland security expenditure
3.4.2. Australia faces “moderate risk” of terrorism
3.5. Australia faces a moderate level of threat from foreign terrorist organizations
3.6. Australia has a terrorism index score of 3.1
3.7. Benchmarking with Key Global Markets
3.7.1. Australia’s defense expenditure to remain modest compared to the leading spenders
3.7.2. Australia will continue to dominate the arms market in the Asia-Pacific region
3.7.3. Defense expenditure as a percentage of GDP to remain at 1.9% over forecast period
3.8. Market Opportunities: Key Trends and Growth Stimulators
3.8.1. Top 10 defense market categories by value (US$ million) - forecast-period projections
3.8.2. Land-based C4ISR
3.8.3. Multirole aircraft
3.8.4. Submarines

4. Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense imports expected to increase considerably over the forecast period
4.1.2. The US was the largest arms supplier to Australia during 2013-2017
4.1.3. Import of aircraft and missiles expected to surge over the forecast period
4.2. Export Market Dynamics
4.2.1. Defense exports are expected to increase over the forecast period owing to government initiatives
4.2.2. The US was the main importer of the Australia’s defense goods during 2013-2017
4.2.3. Aircraft and naval vessel constitute the majority of Australia’s exports

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: high
5.1.4. Intensity of rivalry: medium to high
5.1.5. Threat of substitution: high

6. Market Entry Strategy
6.1. Approval for foreign investment in defense industry set at US$216.2 million
6.2. Market Regulation
6.2.1. AIC program ensures the participation of local industry
6.3. Market Entry Route
6.3.1. Budgeting process
6.3.2. Procurement policy and process
6.3.3. Establishing a domestic subsidiary is the preferred market entry route
6.3.4. Foreign OEMs sub-contract defense deals to domestic firms to enter the market
6.3.5. Foreign OEMs offer domestic companies access to global supply chains in order to enter the industry
6.4. Key Challenges
6.4.1. Cost overruns and project delays continue to worry the defense industry
6.4.2. Low allocation of skilled labor in the defense industry

7. Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Domestic Companies
7.2.1. Thales Australia: overview
7.2.2. Thales Australia: products
7.2.3. Thales Australia: recent announcements and strategic initiatives
7.2.4. Thales Australia: alliances
7.2.5. Thales Australia: recent contract wins
7.2.6. Boeing Defense Australia: overview
7.2.7. Boeing Defense Australia: products
7.2.8. Boeing Defense Australia: recent announcements and strategic initiatives
7.2.9. Boeing Defense Australia: alliances
7.2.10. Boeing Defense Australia: Recent Contract Wins
7.2.11. Lockheed Martin Australia: overview
7.2.12. Lockheed Martin Australia: products
7.2.13. Lockheed Martin Australia: recent announcements and strategic initiatives
7.2.14. Lockheed Martin Australia: alliances
7.2.15. Lockheed Martin Australia: recent contract wins
7.2.16. Raytheon Australia: overview
7.2.17. Raytheon Australia: products
7.2.18. Raytheon Australia: Recent Announcements and Strategic Initiatives
7.2.19. Raytheon Australia: alliances
7.2.20. Raytheon Australia: recent contract wins
7.2.21. Austal Ltd: overview
7.2.22. Austal Ltd: products and services
7.2.23. Austal Ltd: recent announcements and strategic initiatives
7.2.24. Austal Ltd: alliances
7.2.25. Austal Ltd: recent contract wins
7.2.26. Saab Systems: overview
7.2.27. Saab Systems: alliances
7.2.28. Saab Systems: products
7.2.29. Saab Systems: recent announcements and strategic initiatives
7.2.30. Saab Systems: recent contract wins
7.2.31. General Dynamics Land Systems Australia: overview
7.2.32. General Dynamics Land Systems Australia: products
7.2.33. General Dynamics Land Systems Australia: recent announcements and strategic initiatives
7.2.34. General Dynamics Land Systems Australia: recent contract wins
7.2.35. Navantia: overview
7.2.36. Navantia: products
7.2.37. Navantia: recent announcements and strategic initiatives
7.2.38. Navantia: alliances
7.2.39. Navantia: recent contract wins
7.2.40. Airbus Group Australia Pacific: overview
7.2.41. Airbus Group Australia Pacific: products
7.2.42. Airbus Group Australia Pacific: recent announcements and strategic initiatives
7.2.43. Airbus Group Australia Pacific: Alliances
7.2.44. Airbus Group Australia Pacific: Recent Contract Wins
7.3. Key Public Sector Company
7.3.1. ASC: overview
7.3.2. ASC: products
7.3.3. ASC: recent announcements and strategic initiatives
7.3.4. ASC: alliances
7.3.5. ASC: Recent Contract Wins

8. Business Environment and Country Risk
8.1. Economic Performance
8.1.1. GDP per capita
8.1.2. GDP at current prices (US$)
8.1.3. Exports of goods and services current prices
8.1.4. Imports of goods and services (current prices)
8.1.5. Gross national disposable income (US$ Billion)
8.1.6. Domestic currency unit per US dollar
8.1.7. Market capitalization of listed companies
8.1.8. Market capitalization of listed companies 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. Goods imports as a percentage of GDP
8.1.12. Goods trade surplus/deficit as a percentage of GDP
8.1.13. Service imports as a percentage of GDP
8.1.14. Service exports as a percentage of GDP
8.1.15. Foreign direct investment, net (BoP, current US$ Billion)
8.1.16. Net foreign direct investment as a percentage of GDP
8.1.17. Mining, manufacturing, utilities output (LCU Billion)

9. Appendix 

List of Tables
Table 1: Australia - Army Strength, 2018
Table 2: Australia - Navy Strength, 2018
Table 3: Australia - Air Force Strength, 2018
Table 4: Australia - Procurement Programs
Table 5: Australia - Future Procurement Programs
Table 6: Australia - Defense Procurement Programs by Value (US$ Million) 2018-2023
Table 7: Australia - Defense Expenditure (AUD Billion/US$ Billion), 2014-2023
Table 8: Australia - GDP Growth vs Defense Expenditure as Percentage of GDP Growth, 2014-2023
Table 9: Australia - Defense Budget Split by Capital and Revenue Expenditure (%), 2014-2023
Table 10: Australia - Defense Capital Expenditure (AUD Billion/US$ Billion), 2014-2023
Table 11: Australia - Defense Expenditure Allocation (%), 2014-2023
Table 12: Australia - Defense Budget Breakdown by Service (AUD Billion), 2014-2023
Table 13: Australia - Defense Budget Breakdown by Service ( US$ Billion), 2014-2023
Table 14: Australia - Per Capita Defense Expenditure (US$), 2014-2023
Table 15: Australia - Homeland Security Expenditure (AUD Billion/US$ Billion), 2014-2023
Table 16: Terrorism Index, 2018
Table 17: Australia - Benchmarking with Key Markets (US$ Billion), 2014-2018 vs 2019-2023
Table 18: Australia - 10 Leading Defense Market Categories by Value (US$ Million) - 2018-2023
Table 19: Australia - FATA Approval for Acquisitions within the Defense Industry
Table 20: Australia - Budget Formation Timetable, (July 1-June 30)
Table 21: Australia - Foreign Military Sales Deals, 2012-2014
Table 22: Australia - Key Foreign OEMS and Subsidiaries
Table 23: Australia - Small Projects with Cost Overruns (US$ Million), 2018
Table 24: Australia - Major Projects with Cost Overruns (US$ Million), 2018
Table 25: Australia - Project Delays, 2018
Table 26: Australia - Top 10 Defense Suppliers by Value (US$ Million), 2018-2023
Table 27: Australia - Competitive Landscape, 2018
Table 28: Thales Australia - Main Products
Table 29: Thales Australia - Alliances
Table 30: Thales Australia - Recent Contract Wins
Table 31: Boeing Defense Australia - Main Products
Table 32: Boeing Defense Australia - Alliances
Table 33: Boeing Defense Australia - Recent Contract Wins
Table 34: Lockheed Martin Australia - Main Products
Table 35: Lockheed Martin Australia - Alliances
Table 36: Lockheed Martin Australia - Recent Contract Wins
Table 37: Raytheon Australia - Main Products
Table 38: Raytheon Australia - Alliances
Table 39: Raytheon Australia - Recent Contract Wins
Table 40: Austal Ltd - Main Products and Services
Table 41: Austal - Alliances
Table 42: Austal Ltd - Recent Contract wins
Table 43: Saab Systems - Alliances
Table 44: Saab Systems - Main Products
Table 45: Saab Systems - Recent Contract Wins
Table 46: General Dynamics Land Systems Australia - Main Products
Table 47: General Dynamics Land Systems Australia - Recent Contract Wins
Table 48: Navantia - Main Products
Table 49: Navantia - Alliances
Table 50: Navantia - Recent Contract Wins
Table 51: Airbus Group Australia Pacific - Main Products
Table 52: Airbus Group Australia Pacific - Alliances
Table 53: Airbus Group Australia Pacific - Recent Contract Wins
Table 54: ASC - Main Products
Table 55: ASC - Alliances
Table 56: ASC - Recent Contract wins

List of Figures
Figure 1: Australia - Defense Expenditure (AUD Billion), 2014-2023
Figure 2: Australia - Defense Expenditure (US$ Billion), 2014-2023
Figure 3: Australia - GDP Growth vs Defense Expenditure as Percentage of GDP, 2014-2023
Figure 4: Australia - Defense Budget Split by Capital and Revenue Expenditure (%), 2014-2023
Figure 5: Australia - Capital Expenditure (AUD Billion), 2014-2023
Figure 6: Australia - Capital Expenditure (US$ Billion), 2014-2023
Figure 7: Australia - Defense Expenditure Allocation (%), 2014-2023
Figure 8: Australia - Defense Budget Breakdown by Service (AUD Billion), 2014-2023
Figure 9: Australia - Defense Budget Breakdown by Service (US$ Billion), 2014-2023
Figure 10: Australia - Per Capita Defense Expenditure (US$), 2014-2023
Figure 11: Australia - Homeland Security Budget (AUD Billion), 2014-2023
Figure 12: Australia - Homeland Security Budget (US$ Billion), 2014-2023
Figure 13: Terrorism Heat Map, 2018
Figure 14: Terrorism Index, 2018
Figure 15: Benchmarking with Key Markets (%) 2014-2018 vs 2019-2023
Figure 16: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2018 and 2023
Figure 17: Defense Expenditure as a Percentage of GDP by Country (%), 2018
Figure 18: Australia - Land-Based C4ISR Market Size (US$ Million), 2018-2023
Figure 19: Australia - Multirole Aircraft Market Size (US$ Million), 2018-2023
Figure 20: Australia - Diesel Electric Submarine Market Size (US$ Million), 2018-2023
Figure 21: Australia - Defense Procurements in Terms of Supplier Relationships, 2018
Figure 22: Australia - Defense Import (US$ Million), 2013-2017
Figure 23: Australia - Defense Imports by Country (%), 2013-2017
Figure 24: Australia - Defense Imports by Category (%), 2013-2017
Figure 25: Australia - Defense Exports Trend (US$ Million), 2013-2017
Figure 26: Australia - Defense Exports by Country (%), 2013-2017
Figure 27: Australia - Defense Exports by Category (%), 2013-2017
Figure 28: Industry Dynamics - Porter’s Five Forces Analysis
Figure 29: Australia - GDP Per Capita at Constant Prices (US$), 2015-2025
Figure 30: Australia - GDP at Current Prices (US$ Billion), 2015-2025
Figure 31: Australia - Exports of Goods and Services (LCU Billion), 2005-2014
Figure 32: Australia - Imports of Goods and Services (LCU Billion), 2005-2014
Figure 33: Australia - Gross National Disposable Income (US$ Billion), 2005-2012
Figure 34: Australia - Domestic Currency Unit per US$ - Exchange Rate, 2015-2024
Figure 35: Australia - Market Capitalization of Listed Companies (US$ Billion), 2005-2012
Figure 36: Australia - Market Capitalization of Listed Companies as Percentage of GDP, 2005-2012
Figure 37: Australia - Government Cash Surplus/Deficit as a Percentage of GDP, 2005-2012
Figure 38: Australia - Goods Exports as a Percentage of GDP, 2005-2014
Figure 39: Australia - Goods Imports as a Percentage of GDP, 2005-2014
Figure 40: Australia - Goods Trade Surplus/Deficit as a Percentage of GDP, 2005-2014
Figure 41: Australia - Service Imports as a Percentage of GDP, 2005-2014
Figure 42: Australia - Service Exports as a Percentage of GDP, 2005-2014
Figure 43: Australia - Foreign Direct Investment, Net BoP (US$ Billion), 2005-2014
Figure 44: Australia - Net Foreign Direct Investment as a Percentage of GDP, 2005-2014
Figure 45: Australia - Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014

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  • Airbus Group Australia Pacific, ASC.
  • Austal Ltd
  • Boeing Defense Australia
  • General Dynamics Land Systems Australia
  • Lockheed Martin Australia
  • Navantia
  • Raytheon Australia
  • Saab Systems
  • Thales Australia
Note: Product cover images may vary from those shown
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