Smart Weapons Market Size, Share & Industry Analysis, By Product (Missiles, Munitions, Guided Projectiles, Guided Rockets, and Directed Energy Weapons), By Platform (Air, Land, and Naval), By Technology (Laser Guidance, Infrared Guidance, Radar Guidance, Satellite Guidance, and Others), and Regional Forecast, 2024-2032

The global smart weapons market size was USD 18.99 billion in 2023 and is projected to grow USD 20.20 billion in 2024 to USD 45.24 by 2032 at a CAGR of 10.61% during 2024-2032. North America dominated the smart weapons market with a market share of 33.86% in 2023.

The global impact of COVID-19 has been unprecedented and staggering, with smart weapons witnessing a slightly negative impact on demand across all regions amid the pandemic.

A smart weapon allows target hitting with higher accuracy by using a guidance system. It includes air-to-ground missiles, sensor-fused weapons, steerable bombs, and guided weapons equipped with satellite or laser guidance systems. Additionally, the satellite-guided bombs consist of guidance computers that use navigation satellites to confirm the target. By adopting smart technology, cruise missiles can adopt navigation satellite information to maintain a proper flight course. On January 2021, the Defense Research and Development Organization (DRDO) of India conducted a successful trial of a newly developed Smart Anti-Airfield Weapon (SAAW) equipped on the Hawk-I jet developed by the Hindustan Aeronautics Limited (HAL).

The defense industry faced unprecedented challenges due to the outbreak of the COVID-19 pandemic. The shutdown in most countries of the world had a huge impact on the defense industry, causing production shutdowns for key players and delays in the delivery of smart weapons. In March 2020, the production of the Rafale was halted due to a shutdown in France, which caused a delay in the delivery of the aircraft to India. Despite the delays, the market should continue to grow during the pandemic. For example, in March 2020, Raytheon Company signed a USD 353.3 million contract with the U.S. Navy to supply guided missile gyro packages and spare parts for Block 2A and two mobile airframes. Therefore, it is expected that the signing of contracts by large companies will lead to stable market growth under the conditions of COVID-19.

Smart Weapons Market Trends

Development of Network Enabled Weapons to Transform Armed Force Operations

Nowadays, smart weapons original equipment manufacturers (OEMs) primarily focus on developing advanced technology weapons. Network-enabled weapons (NEW) can integrate and share information between systems and platforms in real-time. These weapons can find, track, and engage a target faster than before while proving essential during the de-conflicting operations. These NEWs can exchange information between the nodes linked to the network and drive their demand across armed forces worldwide. In January 2021, MBDA signed a contract with the U.K Ministry of Defense to equip a new mini Spear 3 network-enabled cruise missile for its F-35B combat jets. The value of the contract was worth USD 750 million. Therefore, the development of advanced weapon systems is expected to bode well for the global smart weapons market growth in the forthcoming years.

Smart Weapons Market Growth Factors

Increasing Need for Precision Weapons Due to Rising Warfare Activities to Boost Growth

The growing need for highly precise weapons due to the increasing geopolitical conflicts, and cross-border issues, among others, are the factors driving the growth of the global market. The high demand for such weapons is due to their cost-effectiveness, higher accuracy, versatility, increased operational range, and minimal training time. Furthermore, the rising number of replenishment and modernization programs from military forces is likely to boost the demand for these weapons. For instance, in March 2020, Raytheon Technologies Corporation signed a modification contract worth USD 110 million with the U.S. Navy to modernize the radar-guided gun weapon system. The system is expected to help the U.S. Navy strengthen its defense against aircraft and anti-ship missile littoral warfare threats.

Surging Defense Budgets and Procurement of Next-generation Smart Weapons to Propel Growth

The increasing defense expenditure, expansion of military forces, and procurement of advanced weapons for special operations are some of the factors that are anticipated to drive the market growth. According to the Stockholm International Peace Research Institute (SIPRI), the United States allotted USD 732 billion for the defense sector in 2020. China, India, Russia, and Saudi Arabia's defense budget was USD 261 billion, USD 71.1 billion, USD 65.1 billion, USD 61.9 billion, respectively. Thus, the growing procurement of these smart type of weapons for military operations is expected to propel the growth of the market.

For instance, in 2019, the Russian Navy received the Beriev Be-200 amphibious aircraft for naval operations. In April 2019, Elbit Systems signed a two-year contract with one of the Asia-Pacific countries to supply a precisely guided mortar munition (GMM), STYLET. The value of the contract was worth USD 30 million.

RESTRAINING FACTORS

Stringent Government Regulations on Guided Firearms to Hamper Growth

Stringent government rules and regulations in India, New Zealand, Australia, U.K., and other countries are expected to hinder the growth of the global market. These countries have enforced strict regulations regarding the acquisition and use of weapons. In 2019, for example, New Zealand banned semi-automatic weapons across the country after 50 people were killed in a mass shooting at mosques in Christchurch. Additionally, India has some of the strictest gun laws in the world when it comes to issuing gun permits. Consequently, such factors are expected to hinder the growth of the market in the coming years.

Smart Weapons Market Segmentation Analysis

By Product Analysis

Missiles Segment to Hold Largest Share Backed by Increasing Demand from Armed Forces

Based on the product, the global market is segmented into missiles, munitions, guided projectiles, guided rockets, and directed energy weapons.

The missiles segment is expected to remain dominant due to the increasing demand for advanced guided missiles from the defense forces. For instance, in September 2019, BAE Systems signed a contract worth USD 2,680 million with the U.S. and nine other countries to provide a semi-guided missile weapons system till 2025.

The munition segment is estimated to show the highest growth rate during the forecast period. The growth is attributed to the increasing demand for next-generation precision-guided munitions due to the rising terrorist activities, political unrest, and cross-border conflicts worldwide.

By Platform Analysis

Land Segment to Grow Rapidly due to High Demand from Military Forces

Based on the platform, the market is classified into air, land, and naval.

The land segment is anticipated to be the fastest-growing segment during the forecast period. The increasing defense spending, the rapid expansion of military forces, and the growing procurement of smart weapons will boost segmental growth. For instance, in July 2017, CGI signed a contract with the U.S. Army to support the Army’s Aviation and Missile Command (AMCOM) programs. The value of the contract was worth USD 92.5 million.

The air segment will showcase significant growth owing to the rising demand for precision weapons from air forces. For instance, in 2020, Smart Anti-Airfield Weapon (SAAW) developed by DRDO launched from the Indian Air Force’s Sukhoi Su-30MKI and SEPECAT Jaguar aircraft.

The naval segment will showcase moderate growth owing to the increasing procurement of directed energy weapons from naval forces.

By Technology Analysis

Laser Guidance Segment to Experience Highest Growth Stoked by Development of Technologically Advanced Products

Based on the technology, the market is divided into laser guidance, infrared guidance, radar guidance, satellite guidance, and others.

The laser guidance segment is anticipated to showcase exponential growth in the forthcoming years. The growth is due to the introduction of the latest technology such as lasers that improves accuracy and operational efficiency.

The satellite guidance segment is projected to showcase significant growth during the forecast period. The growth is due to the growing demand for GPS-guided smart weapons as they can operate efficiently even during bad weather conditions.

REGIONAL INSIGHTS

Based on region, the market is segmented into North America, Europe, Asia-Pacific, and Rest of the World.

North America stood at USD 6.43 billion in 2023 and is likely to dominate the global smart weapons market during the forecast period. The growth is attributed to the highest defense or military spending and increasing military modernization programs. In 2019, the U.S. Department of Defense allotted USD 4.3 billion for the procurement of 6,062 munitions. Moreover, the presence of key players such as Boeing Company, Lockheed Martin Corporation, Northrop Grumman Corporation, General Dynamics Corporation, and others will favor the regional market growth.

Asia-Pacific is anticipated to showcase remarkable growth during the forecast period. The growth is due to growing investments in the defense sector from India, China, South Korea, Japan, and others. Cross border conflicts, political unrest, and rising terrorism across Asia Pacific propel the key market growth during the forecast period.

Europe is expected to experience significant growth due to key players such as Thales Group, BAE Systems, Rheinmetall AG, and others. Additionally, the increasing defense expenditure for strengthening military forces from countries such as the U.K, France, and Russia is likely to drive the demand for these weapons.

The market in Rest of the World is anticipated to experience considerable growth due to the rising procurement of advanced smart weapons from the Middle Eastern countries such as the UAE, Saudi Arabia, and others. In June 2019, EDGE signed a contract worth USD 1 billion with the UAE Armed forces to deliver its Desert Sting-16 range of precision-guided weapons.

List of Key Companies in Smart Weapons Market

Key Players Focus on Business Expansion through Contracts, Partnerships, and Merger & Acquisitions

Several key players in the market are focusing on developing advanced technology products for improving overall defense operations. Additionally, original equipment manufacturers (OEMs) focus on business expansion through contracts with military forces, mergers & acquisitions, etc. For instance, on February 19, 2021, India launched homegrown missile Helina from the advanced light helicopter, Dhruv. It was designed and developed by the Defense Research and Development Organization (DRDO) of India. Helina is an anti-tank guided missile test-fired during a joint user trial by the Indian Air Force (IAF) and Indian Army.

LIST OF KEY COMPANIES PROFILED:

• BAE Systems (The U.K)


• Boeing (The U.S.)


• General Dynamics Corporation (The U.S.)


• Lockheed Martin Corporation (The U.S.)


• MBDA (France)


• Northrop Grumman Corporation (The U.S.)


• Raytheon Company, a Raytheon Technologies company (The U.S.)


• Rheinmetall AG (Germany)


• Textron Inc. (The U.S.)


• Thales Group (France)

KEY INDUSTRY DEVELOPMENTS:

• February 2021 – Lockheed Martin Corporation signed a contract worth USD 414 million with the U.S. Navy and Air Force to supply LRASM. It is an anti-ship, precision-guided standoff missile based on the successful joint air-to-ground standoff missile.


• March 2020 – Raytheon signed a contract worth USD 86 million with the U.S. Department of Defense (DoD) to provide engineering services for M982 Excalibur long-range precision artillery munitions.

REPORT COVERAGE

The research report provides a detailed smart weapons industry analysis and focuses on key aspects such as smart weapons products, key players, platforms, and technology used in weapons. Moreover, the research report offers insights on market trends, competitive landscape, market competition, product pricing, market status, and key industry developments. In addition to the factors mentioned above, the market report encompasses several direct and indirect factors that have contributed to the global market's sizing over recent years.

Report Scope & Segmentation