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

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

Summary

"Future of the Chinese Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023" provides readers with detailed analysis of both historic and forecast defense industry values, factors influencing demand, the challenges faced by industry participants, analysis of industry leading companies, and key news.

This report offers detailed analysis of the Chinese 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 Chinese defense industry market size and drivers: detailed analysis of the Chinese 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 with respect to capital expenditure and revenue expenditure. It also details the key challenges faced by defense market participants within the country

Porter’s Five Force analysis of the Chinese 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 Chinese defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Scope

China is the second largest defense spender globally after the US. The country’s large military budget is primarily driven by its robust economic growth and its desire to match the US in terms of military capabilities.

Additionally, China shares its borders with 14 countries, and is involved in several border disputes, which increases the need to invest in the recruitment and maintenance of a large number of troops to prevent infiltration or further hostile acts.

The Chinese defense budget grew at a CAGR of 7.10% during 2014-2018, from US$131.1 billion in 2014 to US$172.5 billion in 2018.

Defense imports are expected to remain low over the forecast period as China is investing in the local manufacture of its defense requirements, such as J-15 fighters, J-20 fighters, Yun-20 and Y-30 transport aircraft, and Type 055 destroyers.

The country’s focus on manufacturing and procuring defense equipment domestically is reflected in the steady decline of imports since 2013; it is expected that China will continue to procure defense equipment from its nationalized companies over the forecast period.

Reasons to Buy

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

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 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. Top procurement programs by value (US$ million) 2018-2023
3.1.6. Social, political and economic environment and support for defense projects
3.1.7. Political and strategic alliances
3.2. Defense Market Size Historical and Forecast
3.2.1. Chinese defense expenditure is expected to increase at a CAGR of 7.92% over the forecast period
3.2.2. Race over military supremacy, territorial disputes, peacekeeping missions, increasing tension with the US, and research and development are the main factors driving Chinese defense expenditure
3.2.3. Chinese defense budget as a percentage of GDP is expected to remain stable
3.3. Analysis of Defense Budget Allocation
3.3.1. China is expected to allocate a high share to revenue expenditure over the forecast period
3.3.2. Defense capital expenditure is expected to increase at a CAGR of 7.92% over the forecast period
3.3.3. Per capita defense expenditure is expected to increase substantially during the forecast period
3.4. Homeland Security Market Size and Forecast
3.4.1. Chinese homeland security is expected to reach US$40.4 billion by 2023
3.4.2. Organized crime, terrorist threats, and cyber protection are expected to drive Chinese homeland security expenditure
3.4.3. China falls under the “highly affected” terrorism category
3.4.4. China is “highly affected” by terrorism as per the Terrorism Index
3.4.5. China has a Terrorism Index score of 5.5
3.5. Benchmarking with Key Global Markets
3.5.1. China will be the largest defense spender in Asia over the forecast period
3.5.2. China has the second largest defense budget in the world
3.5.3. China allocates a lower share of GDP to defense compared to the US and other Asian countries
3.6. Market Opportunities: Key Trends and Growth Stimulators
3.6.1. Top defense market sectors by value (US$ million) - projections over 2018-2023
3.6.2. Missile defense systems
3.6.3. Land-based C4ISR
3.6.4. Physical Security

4. Defense Procurement Market Dynamics

4.1. Import Market Dynamics
4.1.1. China is expected to import fewer weapons over the forecast period
4.1.2. Russia accounts for the majority of Chinese defense imports
4.1.3. Aircraft, engines, and naval vessels are the most imported military hardware
4.2. Export Market Dynamics
4.2.1. Defense exports are expected to grow over the forecast period
4.2.2. Pakistan emerged as the biggest importer of Chinese low-cost defense equipment exports
4.2.3. Chinese aircraft and naval vessel exports expected to increase

5. Industry Dynamics

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

6. Market Entry Strategy

6.1. Market Regulation
6.1.1. The Chinese military-industrial complex opens up to private sector participation
6.1.2. Defense industry remains closed to foreign direct investment
6.2. Market Entry Route
6.2.1. Budget process
6.2.2. Procurement policy and process
6.2.3. Foreign technology finds its way into the Chinese defense industry through civil-military integration
6.3. Key Challenges
6.3.1. Lack of competition and long production cycles continue to hamper the performance of the Chinese defense industry
6.3.2. Arms embargo imposed by the US and EU

7. Competitive Landscape and Strategic Insights

7.1. Competitive Landscape Overview
7.1.1. State-owned enterprises are the only major players in China’s defense industry
7.1.2. Foreign technology enters the Chinese defense market by supplying civil use products
7.2. Key Domestic Companies
7.2.1. China North Industries Corporation: Overview
7.2.2. China North Industries Corporation: Products
7.2.3. China North Industries Corporation: Recent announcements and strategic initiatives
7.2.4. China North Industries Corporation: Alliances
7.2.5. China North Industries Corporation: Recent contract wins
7.2.6. China Electronics Technology Group Corporation: Overview
7.2.7. China Electronics Technology Group Corporation: Products
7.2.8. China Electronics Technology Group Corporation: Recent Announcements and Strategic Initiatives
7.2.9. China Electronics Technology Group Corporation: Alliances
7.2.10. China Electronics Technology Group Corporation: Recent contract wins
7.2.11. Aviation Industry Corporation of China: Overview
7.2.12. Aviation Industry Corporation of China: Products
7.2.13. Aviation Industry Corporation of China: Recent announcements and strategic initiatives
7.2.14. Aviation Industry Corporation of China: Alliances
7.2.15. Aviation Industry Corporation of China: Recent contract wins
7.2.16. China National Nuclear Corporation: Overview
7.2.17. China National Nuclear Corporation: Services
7.2.18. China National Nuclear Corporation: Recent Announcements and Strategic Initiatives
7.2.19. China National Nuclear Corporation: Alliances
7.2.20. China National Nuclear Corporation: Recent contract wins
7.2.21. China Nuclear Engineering and Construction Corporation: Overview
7.2.22. China Nuclear Engineering and Construction Corporation: Services
7.2.23. China Nuclear Engineering and Construction Corporation: Recent announcements and strategic initiatives
7.2.24. China Nuclear Engineering and Construction Corporation: Alliances
7.2.25. China Aerospace Science and Industry Corporation: Overview
7.2.26. China Aerospace Science and Industry Corporation: Products
7.2.27. China Aerospace Science and Industry Corporation: Recent announcements and strategic initiatives
7.2.28. China Aerospace Science and Industry Corporation: Alliances
7.2.29. China Aerospace Science and Technology Corporation: Overview
7.2.30. China Aerospace Science and Technology Corporation: Products
7.2.31. China Aerospace Science and Technology Corporation: Recent announcements and strategic initiatives
7.2.32. China Aerospace Science and Technology Corporation: Alliances
7.2.33. China State Shipbuilding Corporation: Overview
7.2.34. China State Shipbuilding Corporation: Products
7.2.35. China State Shipbuilding Corporation: Recent announcements and strategic initiatives
7.2.36. China State Shipbuilding Corporation: Alliances
7.2.37. China State Shipbuilding Corporation: Recent contract wins
7.2.38. China National Electronics Import and Export Corporation: Overview
7.2.39. China National Electronics Import and Export Corporation: Products
7.2.40. China National Aero-Technology Import and Export Corporation: Overview
7.2.41. China National Aero-Technology Import and Export Corporation: Products
7.2.42. China National Aero-Technology Import and Export Corporation: Recent announcements and strategic initiatives

8. Business Environment and Country Risk

8.1. Economic Performance
8.1.1. Gross Domestic Product per Capita
8.1.2. Gross Domestic Product (Current US$ Billion)
8.1.3. Exports of Goods and Services in LCU
8.1.4. Imports of Goods and Services in LCU
8.1.5. LCU per US$
8.1.6. Market Capitalization of Listed Companies (US$ Billion)
8.1.7. Market Capitalization of Listed Companies (Percentage of GDP)
8.1.8. Goods Exports as a Percentage of GDP
8.1.9. Goods Imports as a Percentage of GDP
8.1.10. Services Imports as a Percentage of GDP
8.1.11. Services Exports as a Percentage of GDP
8.1.12. Net Foreign Direct Investment (BoP, current US$ Billion)
8.1.13. Net FDI as a Percentage of GDP
8.1.14. Mining, Manufacturing, Utilities Output

9. Appendix

9.1. About
9.2. Disclaimer

List of Tables

Table 1: China - Defense Modernization
Table 2: Chinese Army Strength
Table 3: Chinese Air Force Strength
Table 4: Chinese Navy Strength
Table 5: China - Ongoing Development and Procurement Programs
Table 6: China - Future Procurement Programs
Table 7: Top Chinese Defense Procurement Programs by Value (US$ Million) 2018-2023
Table 8: China Defense Expenditure (CYN Billion and US$ Billion), 2014-2023
Table 9: China GDP Growth and Defense Expenditure as a % of GDP Growth, 2014-2023
Table 10: China Defense Expenditure Split Between Capital and Revenue Expenditure (%), 2014-2023
Table 11: China Defense Capital Expenditure (CYN Billion and US$ Billion), 2014-2023
Table 12: China per Capita Defense Expenditure (US$), 2014-2023
Table 13: China Homeland Security Expenditure (CYN Billion and US$ Billion), 2014-2023
Table 14: Terrorism Index
Table 15: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023
Table 16: Top Chinese Defense Market Sectors by Value (US$ Million) - 2018-2023
Table 17: Chinese Budget Formation Timetable
Table 18: Top Defense Suppliers in the Chinese Defense Industry by Value (US$ Million), 2018-2023
Table 19: Chinese Defense Enterprise Groups
Table 20: Competitive Landscape of the Chinese Defense Industry
Table 21: Chinese Military-Industrial Complex - Competitive Landscape
Table 22: China North Industries Corporation - Product Focus
Table 23: China North Industries Corporation - Alliances
Table 24: China North Industries Corporation - Recent Contract Wins
Table 25: China Electronics Technology Group Corporation - Product Focus
Table 26: China Electronics Technology Group Corporation - Alliances
Table 27: China Electronics Technology Group Corporation - Recent Contract Wins
Table 28: Aviation Industry Corporation of China - Product Focus
Table 29: Aviation Industry Corporation of China - Alliances
Table 30: Aviation Industry Corporation of China: Recent Contract Wins
Table 31: China National Nuclear Corporation - Services Focus
Table 32: China National Nuclear Corporation - Alliances
Table 33: China National Nuclear Corporation - Recent Contract Wins
Table 34: China Nuclear Engineering and Construction Corporation - Services Focus
Table 35: China Nuclear Engineering and Construction Corporation- Alliances
Table 36: China Aerospace Science and Industry Corporation - Product Focus
Table 37: China Aerospace Science and Industry Corporation - Alliances
Table 38: China Aerospace Science and Technology Corporation - Product Focus
Table 39: China Aerospace Science and Technology Corporation- Alliances
Table 40: China State Shipbuilding Corporation - Product Focus
Table 41: China State Shipbuilding Corporation - Alliances
Table 42: China State Shipbuilding Corporation: Recent Contract Wins
Table 43: China National Electronics Import and Export Corporation - Product Focus
Table 44: China National Aero-Technology Import and Export Corporation - Product Focus

List of Figures

Figure 1: China Defense Expenditure (CYN Billion), 2014-2023
Figure 2: China Defense Expenditure (US$ Billion), 2014-2023
Figure 3: Chinese GDP Growth and Defense Expenditure as a % of GDP Growth, 2014-2023
Figure 4: Chinese Defense Expenditure Split Between Capital and Revenue Expenditure (%), 2014-2023
Figure 5: China Defense Capital Expenditure (CYN Billion), 2014-2023
Figure 6: China Defense Capital Expenditure (US$ Billion), 2014-2023
Figure 7: China Per Capita Defense Expenditure (US$), 2014-2023
Figure 8: China Homeland Security Expenditure (CYN Billion), 2014-2023
Figure 9: China Homeland Security Expenditure (US$ Billion), 2014-2023
Figure 10: Terrorism Heat Map, 2018
Figure 11: Terrorism Index, 2018
Figure 12: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023
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: Chinese Missile Defense Systems Market Size (US$ Billion), 2018-2023
Figure 16: Chinese Land-based C4ISR Market Size (US$ Billion), 2018-2023
Figure 17: Chinese Physical Security Market Size (US$ Billion), 2018-2023
Figure 18: Top Chinese Defense Procurements in terms of Supplier Relationships
Figure 19: Chinese Defense Import Trend, 2013-2017 (TIV values)
Figure 20: Chinese Defense Imports by Country (%), 2013-2017
Figure 21: Chinese Defense Imports by Category (%), 2013-2017
Figure 22: Chinese Defense Exports Trend, 2013-2017 (TIV values)
Figure 23: Chinese Defense Exports by Country (%), 2013-2017
Figure 24: Chinese Defense Exports by Category (%), 2013-2017
Figure 25: Industry Dynamics Porter’s Five Forces Analysis
Figure 26: GDP per Capita, 2015-2025
Figure 27: GDP Current US$ (US$ Billion), 2015-2025
Figure 28: Exports of Goods and Services (LCU Billion), 2005-2014
Figure 29: Chinese Imports of Goods and Services (LCU Billion), 2005-2014
Figure 30: LCU per US$, 2015-2024
Figure 31: Market Capitalization of Listed Companies (US$ Billion), 2005-2012
Figure 32: Market Capitalization of Listed Companies as a % of GDP, 2005-2012
Figure 33: Goods Exports as a % of GDP, 2005-2013
Figure 34: Goods Imports as a % of GDP, 2005-2013
Figure 35: Services Imports as a % of GDP, 2005-2013
Figure 36: Services Exports as a % of GDP, 2005-2013
Figure 37: Net Foreign Direct Investment (BoP, current US$ Billion), 2005-2013
Figure 38: Net FDI as a % of GDP, 2005-2013
Figure 39: Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014