Military Drone Market Size, Share & Russia-Ukraine War Impact Analysis, By Product Type (Fixed Wing, Hybrid, and Rotary Wing), By Range (Visual Line of Sight (VLOS), Extended Visual Line of Sight (EVLOS), and Beyond Line of Sight (BLOS)), By Technology (Remotely Operated Drones, Semi-Autonomous Drones, and Autonomous Drones), By System (Airframe, Avionics, Propulsion, Payload, Software, and Others), By Application (Intelligence, Surveillance Reconnaissance and Targeting (ISRT), Combat Operations, Battle Damage Management, Logistics & Transportation), and Regional Forecast, 2023-2030

The global military drone market size was valued at USD 12.55 billion in 2022 and is projected to grow from USD 14.14 billion in 2023 to USD 35.60 billion by 2030, exhibiting a CAGR of 14.10% during the forecast period.

The growing use of Unmanned Aerial Vehicles (UAVs) in the defense and security industry for several applications such as surveying, mapping, transportation, combat operations, and monitoring will fuel the demand for military UAVs in the coming years. The rise in defense expenditure of various countries to procure modernized & technologically advanced military drones/UAVs for intensified combat capability is expected to support the global market growth. The adoption of Artificial Intelligence (AI) is modernizing military drone technologies from picking targets autonomously with precision. Furthermore, increasing investment in AI and autonomous systems for advanced technologies is boosting this market.

RUSSIA-UKRAINE WAR IMPACT

High Adoption Rate of Military Drones in Russia-Ukraine War to Bolster the Market Growth 

In the Russia-Ukraine war, which began in February 2022, Russia and Ukraine have

 utilized drones for various military operations such as Intelligence, Surveillance, and Reconnaissance (ISR) operations, target acquisition support, and other operations.

• Russia recently acquired Iranian loitering munitions Shahed-136 called Geranium-2 by Russian Ground Forces. Its first use was mentioned in September 2022 for military operations in the Kharkiv region in Eastern Ukraine. Furthermore, it has been utilized to target Kyiv, Odesa, and Mykolaiv.


• Ukraine has been supplied with more than 700 Switchblade kamikaze drones to target Western Crimea, an airbase and ship harbor near Sevastopol, and airbases at Ryazan and Saratov.

In addition, Russia signed a contract worth USD 12 million with China to provide military drones for the Russian Armed Forces amid the ongoing Russia-Ukraine war. These factors are expected to propel the military drone market growth over the forecast period.

LATEST TRENDS

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Introduction of Artificial Intelligence with Autonomous Flight Systems to Drive Market Growth

Drone technology has witnessed strong growth in the past years due to continuous research & development. Innovation enhancing the capabilities and increasing adoption of modernized technologically advanced UAVs has potential opportunities. Most advanced drones have multiple sensor systems, such as air-to-air missiles, Communication Intelligence Sensors, and Global System for Mobile (GSM) communications. Today, the most advanced unmanned aerial vehicles can carry a few pieces of equipment attached to large sensors and internal weapons compartments.

Autonomous flight systems for high-altitude military drones are being commercially developed with AI. The increasing growth of artificial intelligence and autonomous systems will likely boost the market. This development is expected to lead to strong growth in the global military unmanned aircraft market in future. The weapon payload includes missile and guided bomb units.

DRIVING FACTORS

Increasing Military Spending and Growing Procurement of Military Drones from Defense Forces to Boost the Market Growth

Several countries invested highly in strengthening their defense forces, which is expected to drive market growth. As per Stockholm International Peace Research Institute (SPIRI) report, in 2020, the total global military expenditure rose to USD 1,981 billion, showing an increase of 2.6% from 2019. The top five countries with the highest defense budgets in 2020 were the U.S., China, India, Russia, and the U.K. with budgets of USD 778 billion, USD 252 billion, USD 72.9 billion, USD 61.7 billion, and USD 59.2 billion, respectively.

Russia, Saudi Arabia, China, and India have invested a lot in purchasing and upgrading the overall defense system over the last several years. Such factors will fuel the demand for military unmanned aerial vehicles in the next few years.

• In November 2021, India was set to finalize a deal with the U.S. to procure 30 multi-mission MQ-9B long-endurance predator drones. The contract value was worth USD 3 billion. 

Furthermore, the growing procurement of next-generation military drones from military forces drives market growth.

• In September 2021, Indian Army signed a contract worth USD 13.7 million with Alpha Design and Israel’s ELSEC (Elbit Security Systems) to procure over 100 strike drones.

Rising Cross-Border Conflicts in Several Countries to Fuel Market Growth

Growing border disputes among countries over land ownership and control of the area between two or more states are expected to increase product demand. For the past few years, India, Syria, China, Iran, Pakistan, Israel, and others have faced territorial issues. These countries have increased military spending for procuring real-time surveillance drones to improve situation awareness by upgrading border patrolling.

In June 2020, the China and India border dispute turned deadly for the first time in over four decades. Since May, several thousands of Chinese and Indian troops have been on a standoff in the Ladakh region in the Himalayas. Drone technology has an important role in resolving border disputes. Both countries use military unmanned aerial vehicles for reconnaissance operation and logistics applications in high-altitude areas.

RESTRAINING FACTORS

High Cost of Advanced Electronics and Modern Systems to Hinder Market Growth

UAVs are fully equipped with high-tech propulsion systems, avionics systems, advanced flight management technology, modern sensors, and payloads. These parameters are associated with sophisticated software and high-quality hardware systems depending upon the severity of the operations. The deployment of military UAVs has a different product portfolio for the army, air force, and navy owing to different applications varying the overall cost of products.

These factors increase the final price of UAVs across the globe. The huge product, as well as maintenance cost, is expected to restrain future growth. Restrictions on deploying UAVs in several countries and limited use in aerial spaces are also expected to restrict future demand.

SEGMENTATION

By Product Type Analysis

Fixed Wing Segment to Hold Major Share Owing to its Increasing Use for Long Distance Operations

By product type, the market is divided into fixed wing, hybrid wing, and rotary wing. 

The fixed wing segment held the highest share of the military drone market in 2022 and will continue its dominance throughout the forecast period. Compared to VTOL vertical takeoff and landing UAVs, fixed wing aircraft can typically carry a heavier load for longer flight times while using less power. This implies they are best suited to large-distance missions, such as strategic defense, mapping, surveillance and defense, which require high durability. Various military authorities worldwide use it to great effect in the defense sector. These factors are predicted to propel the segment growth throughout the projection period.

The rotary wing segment is anticipated to showcase significant growth in the coming years, owing to increasing development of rotary wings. Rotary wings, extensively used for road and logistics applications in all parts of the world, carry heavy loads. Rotary wing drone is also used for tactical operations for Intelligence, surveillance, and reconnaissance missions due to vertical take-off and landing.

By Range Analysis

Extended Visual Line of Sight Segment to Grow at the Fastest CAGR Impelled by Rising Adoption in Electronic Warfare and Battle Management 

Based on range, the market is divided into Extended Visual Line of Sight (EVLOS), Visual Line of Sight (VLOS), and Beyond Line of Sight (BLOS).

The EVLOS segment is expected to grow at the highest CAGR during the forecast period owing to the high acceptance of EVLOS UAVs in long-range missions to collect important information, proper battle management, and electronic warfare. For instance, in February 2022, General Atomics tested advanced datalink and avionics enhancements for the MQ-1C Gray Eagle Extended Range (GE-ER) drone.

The VLOS range of drones is commonly used in applications such as fire emergencies, border patrol, and disaster relief & management. The BLOS segment is expected to grow substantially over the forecast period owing to the growing awareness that technology is progressing toward advancement and commercialization. These UAVs can transport weapons, ammunition, and cargo to the targeted locations.

By Technology Analysis

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Growing Adoption of Remotely Operated UAVs for Military Operation to Drive Segment Growth

The market is classified into semi-autonomous drones, remotely operated drones, and autonomous drones based on technology.

The remotely operated segment is expected to have a major market share throughout the forecast period. Due to strict government requirements for long-range autonomous flight, many contracted Unmanned Aircraft Vehicles are flying remotely worldwide. This technology has been used on UAVs in Command & Control (C&C), telemetry systems, and radio communications.

The autonomous segment will likely grow at the fastest CAGR during the forecast period. Growing economies are focused on designing and developing autonomous unmanned aerial vehicles to offer tactical and strategic services. The semi-autonomous segment will witness significant growth during 2023-2030 due to the rising preference for fixed-range flight operations to gather vital information.

By System Analysis

Airframe Segment to Dominate due to Increasing Adoption of UAVs in Military

Based on system, the market is categorized into avionics, airframe, payload, propulsion, software, and others.

The airframe segment held the highest market share in the base year. During the forecast period, this segment will continue to lead. This segment results from an increasing adoption of Unmanned Aerial Vehicles for a wide range of defense operations, including surveillance, observation, reconnaissance, and combat.

The propulsion segment is projected to grow at a higher CAGR during the study period owing to increasing demand for turboprop engines in military UAVs due to high durability.

The avionics segment is projected to grow significantly due to integrating modern electronics, automated flight management, and path control. The payload segment is expected to grow throughout the projection period. The segmental growth is attributed to the growing incorporation of payloads such as cameras, radar, sensors, weapons, and others into the UAVs.

By Application Analysis

ISRT Segment to Lead the Market due to Rising Awareness to Strengthen the Defense System

By application, the market is segmented into Intelligence, Surveillance, Reconnaissance, and Targeting (ISRT), logistics & transportation, combat operations, battle damage management, and others.

The ISRT segment is projected to lead during the forecast period. The segmental growth is due to the role of UAVs in the defense industry rather than combat operations. These flying machines are designed to provide crucial information and collect data on the targeted territory or terrorist area.

For applications, such as transportation and logistics, over the last several years, unmanned aircraft have been employed by the U.S. Air Force, Navy, Army, or other security agencies. Market growth is projected to increase over the coming years due to the growing demand for logistics and transport.

REGIONAL INSIGHTS

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The market is subdivided into North America, Europe, Asia Pacific, and the rest of the world.

North America is a dominant region with the highest military drone market share in 2022. This large share is attributed to several OEMs, in the U.S., such as Northrop Grumman Corporation, General Atomics Aeronautical Systems, Inc., and others. Advances have been made in drone technology, which brought major developments within the U.S. military, and increased investment by key regional players boosted the market growth. The U.S. is one of the world's largest exporters of unmanned aerial vehicles, which is expected to drive regional growth. Historically, Lockheed Martin Corporation and General Atomic Aeronautics received contracts for military HALE and MALE drones from NATO and major defense partners such as India. These companies are anticipated to receive more military drone contracts for various operation-specific military drones for ISR or target acquisition or MUM-T (Manned-Unmanned Teaming Platforms).

The Europe market is anticipated to grow substantially due to the rising awareness to improve the air force, navy, and military capabilities. European countries, such as the U.K., Germany, and France are competing to procure tactical and small drones to enhance ISR capability during the foreseeable future.

Asia Pacific is estimated to be the fastest-growing region growing at a higher CAGR, owing to the burgeoning procurements of military drones by most countries in the region. The ongoing Russia-Ukraine war has shifted the procurement priority of regional armed forces toward UAVs, driving the regional market growth during the forecast period.

• According to official sources, Pakistan purchased over 48 GJ-2 drones from China. GJ-2 is a MALE drone that can carry around 12 missiles or attack bombs and has a top speed of 380 km/hour.

In addition, the key players in Asia Pacific are investing heavily in drone development, which will fuel the product demand.

The rest of the world accounted for a lower market share as it is underpenetrated in the region. Furthermore, key players, such as Elbit Systems Ltd and Israel Aerospace Industries Ltd., are focused on developing surveillance, public safety, and infrastructure technologies to boost regional market growth.

KEY INDUSTRY PLAYERS

Key Companies such as Lockheed Martin, Northrop Grumman, and Thales Group to Lead the Market

The market is consolidated due to the strong product portfolio of UAV manufacturers in developed and emerging countries. Thales Group, Lockheed Martin Corporation, and Northrop Grumman Corporation are anticipated to lead the market. However, a low entry barrier is expected to increase the number of domestic UAV companies entering the global market. The growing number of new entrants in the drone industry are expected to lead to a highly fragmented market in the coming years.

LIST OF KEY COMPANIES PROFILED:

• General Atomics Aeronautical Systems, Inc. (U.S.)


• Northrop Grumman Corporation (U.S.)


• Elbit Systems Ltd. (Israel)


• Israel Aerospace Industries Ltd. (Israel)


• AeroVironment, Inc. (U.S.)


• Lockheed Martin Corporation (U.S.)


• Thales Group (France)


• Boeing (U.S.)


• BAE Systems (U.K.)


• SAAB Group (Sweden)


• Textron Systems (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• February 2023 – The Indian Army announced that it is seeking 850 nano drones for special military operations, which should be indigenous nano drones for surveillance and counter-terrorism operations.


• February 2023 – The U.S. Airforce completed the development of face recognition technology in UAVs. Autonomous drones could identify the target and could be killed by themselves. Further, the drones will be working by special operations forces to gather intelligence and mission pieces of information.


• February 2023 – The Indian Coast Guard (ICG) awarded a contract to drone Startup base Sagar Defense Engineering Pvt. to supply 10 multicopter (VTOL) drones. ICG had issued an RFP for procuring the contract under Make in India for increasing the capabilities as well as boosting marine surveillance of the ICG.


• January 2023 - The U.S. Department of Defense awarded State-owned Israel Aerospace Industries a contract to develop and supply new attack drones. These drones, called Point Blank, can easily be carried in soldiers' backpacks and launched from anywhere. 


• December 2022 - British armed forces awarded a contract to the U.K. arm of Lockheed Martin to supply mini drones. Under this agreement, Lockheed Martin received a 10-year state contract to deliver 250 mini drones valued at around USD 137.02 million.

REPORT COVERAGE

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The research report provides detailed market analysis and focuses on key aspects such as product types, leading companies, technology, and applications. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the market growth in recent years.

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