The Value of the Defense Market
The increased demand for air travel and a massive backlog of new airplanes are all adding to an excellent outlook for the aerospace industry. But the industry is experiencing a change that will see significant consolidation within the supply base, and declining pressure on profits as the OEMs speeds up the production of advanced platforms.
- In the defense sector, the following are expected to push global defense sector growth this year and beyond
- Elevated geopolitical risks and global tensions
- The United States’ defense budget recovery
- Increase defense spending in vital regional powers like India, China, and Japan
A Market Outlook by Boeing values the aerospace and defense market at $8.7 trillion over the next ten years, which is a $0.6 trillion increase a year ago. The outlook comprises of a $3.1 trillion forecasted demand for commercial aircraft through 2028. This comes as operators substitute older aircraft with more fuel-efficient and fitted models, and increase their fleets to cover the consistent increase in air travel across developing and established markets. Further, the outlook also estimates $2.5 trillion of aerospace defense opportunities during the next ten years as governments seek new technologies, improved military systems. The government also tried to accelerate exploration from sea to space. The calculated spending – covering autonomous systems, military aircraft, spacecraft, and satellite – will continue to be universal, with 40% of expenses emerging outside of the United States