As Missile Scares Ramp Up, So Do Anti-Missile Tech
Companies
The proliferation of
advanced threats, such as the modified QW-1, China's
second-generation shoulder-fired air defense missile, and the quest
to combat international civil and commercial aviation terrorism,
spell a bright future for the global airborne countermeasures
market.
Defying the effects of global defense budget restraints and rising
costs of research, development, test and evaluation (RDT&E),
production and procurement, the airborne countermeasures industry
continues its upward trend, aided by new platform introductions and
upgrade and modernization programs.
A new study by Frost & Sullivan, international market
consultancy, identifies the aversion to ground warfare and ongoing
improvements in advanced infrared (IR) and radio frequency (RF)
targeting systems as further catalysts behind the continued need
for advanced airborne countermeasure systems.
Furthermore, the growing conduct of low-altitude operations
helps accentuate the imperative to equip military aircraft with the
ability to recognize and defeat ground-to-air and air-to-air
attacks.
Manuel Magalhaes, Program Manager at Frost & Sullivan, is in
optimistic mood. "Reflecting the increasing procurement of a number
of aircraft requiring advanced self-protection systems, revenues in
the world airborne countermeasures market will soar from US$1.27
billion in 2003 past the US$2.2 billion mark in 2012," he
reports.
Frost & Sullivan
notes that defense ministries worldwide are set to allocate
approximately 4 percent, (roughly $36 billion), of their total
defense procurement and RDT&E budget towards electronic warfare
(EW) over the next 10 years. The U.S. alone is forecast to spend
US$25 billion on EW during this timeframe. Airborne countermeasures
are predicted to account for 50 percent of total EW
expenditure.
"In the last two decades, infrared guided missiles have
represented half of the total aircraft losses in theatre. With the
development of advanced infrared-guided surface-to-air missiles
(SAM), which have improved attack capability and immunity to some
flares, we are confident that funding for infrared and
electro-optical countermeasure systems will show rapid growth over
the next few years," Mr Magalhaes continues.
New Missile Warning Systems (MWS), directed IR countermeasures
(DIRCM), and Jamming systems are currently at different stages of
development and testing, with each supplier developing a small
number of variations at significant price differences. The U.S.
continues to be the dominant force in R&D funding and
procurement for these systems, with France and Israel planning to
significantly increase their R&D resources over the next five
years.
Hot on the heels of the market's star performer, IR
countermeasure systems, follows the integrated systems segment,
according to Frost & Sullivan's review of the main airborne
countermeasures systems types. By 2012, these segments will have
accumulated US$4.8 billion and US$4.6 billion respectively.
Northrop Grumman currently holds the leadership spot, followed
by Lockheed Martin, ITT Industries, Thales and BAE Systems. These
five heavyweights are expected to command around half of the total
market in 2003, with the top 10 defense clients accounting for 80
percent of the world's military expenditure. Frost & Sullivan
believes that a small number of Israeli suppliers, namely Elisra,
Elta/IAI and Rafael, should make major forays into the export
market in the coming years, with the potential to clinch more than
10 percent of the overall pie.
"These companies are
developing advanced countermeasure systems and suites at more
attractive prices than their European and U.S. counterparts in an
effort to meet their ambitious export goals. The market is also
seeing a number of collaborations with European and U.S. primes in
the field of development and commercialization of countermeasure
suites," Mr Magalhaes points out.
A handful of Asian countries are ramping up investment in the
development of an EW industry to complement the development and/or
production of airborne platforms and subsystems, influenced mainly
by American, French and Israeli high-tech hybridization. Frost
& Sullivan warns that this move will eventually compromise some
potential opportunities in traditional export markets over the next
decade.
The U.K., France, Israel and the U.S. continue to focus on
developing integrated systems with an emphasis on IR technology for
their own defense capabilities, while the remaining territories
under analysis in Frost & Sullivan's study remain predominately
a systems upgrade market for the next few years. The study further
draws attention to the potential displayed by the emerging market
for advanced lightweight airborne countermeasures for combat and
tactical unmanned aerial vehicle (UAV) systems.
The key challenges which European suppliers in this market are
confronted with include the glut of more attractively-priced U.S.
and Israeli products, the politics presiding over sound procurement
decisions and the perception that U.S.-produced technology enjoys
superiority.
Frost & Sullivan values Western European airborne
countermeasures market at around $270 million in 2003, with the
U.K., France, Italy and Germany responsible for the main thrust of
sales, occupying more than two-thirds of the market.