Defense Drone Market by Product Type (Fixed-wing Systems, Multirotor Systems, and Others), Payload (Small Drones, Medium Drones, and Large Drones), Application (Intelligence, Surveillance, Reconnaissance & Target Acquisition (ISRT), Combat Operations, and Others), Range (Short Range, Medium Range, and High Range), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021-2028

Global Defense Drone Market Analysis

The defense drone market size is estimated to be $16,902.0 million in the 2021-2028 timeframe, growing from $ 9,314.9 million in 2020, at a healthy CAGR of 7.9%.

Market Synopsis

The increase in the defense expenditure by major countries is expected to be the major driving factor for growth of the defense drone market demand.

However, the high initial investment required in the defense drone industry is predicted to restrict the market growth.

According to the regional analysis of the market, the Asia-Pacific defense drone market share is anticipated to grow at a CAGR of 8.4%, by generating a revenue of $4,071.7 million during the defense drone market forecast period.

Defense Drone Market Overview

Defense drones identify security & terrorism-related challenges and vulnerable areas that are prone to a variety of national security risks. Drones are a multiplier of modern forces that can contain terrorism and improve the capabilities of security forces to address new defense and homeland security challenges. They work to detect threats, UAV defence, UAV defense system identify high-risk areas at remote locations, perform border guards, and perform reconnaissance missions.

COVID-19 Impact on Defense Drone Market

The Covid-19 impact on defense drone market has been negative., restraining the growth of the defense drone market.

During the pandemic period, governments across the world turned their focus from counter terrorism and surveillance operations to addressing the public health crisis. In addition to this, the shortage of critical components/materials required in the manufacturing and assembling of equipment used in the defense drones such as C4ISR product type, radar, electro-optical/infrared (EO/IR), acoustic sensors, embedded navigation, positioning sensors, and others is expected to negatively impact the defense drone market.

During this pandemic period, businesses across the world are experiencing the need for digital management of their operations. The need for implementation of technologies such as industrial internet of things (IIOT) that will enable real-time monitoring of manufacturing process of defense drone products and virtual control of production is expected to aid in mitigating the impact of COVID-19 pandemic on the defense drone market.

The Surge in the Defense Expenditure is Anticipated to be a Major Driving Factor of this Market

The defense drone market is anticipated to witness notable growth in the forecast period because of increasing defense expenditure around the world for procurement and upgradation of unmanned surveillance and attack product type. As per the Stockholm International Peace Research Institute (SIPRI), an independent international organization to research into conflict, armaments, and disarmament, the global defense expenditure increased to $1981 billion in the year 2020. The surge in defense expenditure for the research & development of military aviation navigation product type and surveillance product type required in defense aviation is expected to contribute to the growth of global defense drones market size.

These factors are anticipated to aid the growth of defense drone market in the forecast period.

To know more about global defense drone market research and drivers, get in touch with our analysts here.

The Capital-Intensive Nature of Defense Drone Technology to Restrain the Market Growth.

Unmanned aircrafts are very sophisticated and require high cost for manufacturing and operations which make them heavily priced. Along with this, they require high maintenance costs. As the hardware and software required in military avionics for navigation product type, surveillance product type, engine health monitoring, and others are sophisticated and expensive, this can hamper the demand for global defense drone market.

The Increasing Adoption of Artificial Intelligence is Expected to Create Opportunities for Defense Drone Market

The growing adoption of artificial intelligence technologies in drone industry is expected to open new scope of opportunities in the defense drone industry globally. Numerous drones are integrated with the latest sensors, LiDAR, high-tech cameras, GNSS, infrared, and thermal imaging product type. State-of-the-art unmanned aerial vehicles are equipped with multi-sensor product type such as the global mobile communication system (GSM), communication reconnaissance sensors, and air-to-air missiles. The state-of-the-art UAVs can carry a variety of payloads mounted on internal weapon bays and large sensors. Artificial intelligence is currently used commercially in high altitude military UAV autonomous flight product type. These are the positive defense drone market trends that are expected to act as facilitators in the growth of the defense drone market the forecast period.

To know more about global defense drone market trends, get in touch with our analysts here.

Source: Research Dive Analysis

The fixed-wing systems sub-segment is predicted to have a dominating share in the global market and register a revenue of $8,646.0 million in 2028, growing from $4,796.9 million in 2020 during the forecast period.
Fixed-wing systems are widely used in the military and defense, primarily by various military forces around the world. The advantages of the excellent structure for performing surveillance operations on long-range missions stimulate the demand for fixed wing systems. The most advanced and powerful UAVs are designed and built with a fixed wing structure for superior aerodynamics. These factors are expected to aid the growth of this sub-segment.

The multirotor systems sub-segment is anticipated to have the fastest market growth and generate a revenue of $6,869.4 million by 2028, growing from $ 3,722.4 million in 2020, at a healthy CAGR of 8.2% in the forecast period. The surge in development of quadcopters and unmanned rotorcrafts is expected to aid the growth of this sub-segment in the forecast period. These are heavy duty carriers that are strictly used in espionage, logistics, and transportation applications around the world. Rotorcraft are used in tactical military operations for intelligence, surveillance, and reconnaissance missions. Increasing demand for information gathering operations in various countries is expected to boost the growth of the multirotor sub-segment. 

Source: Research Dive Analysis

The small drone’s sub-segment is estimated to have a dominating market share in the global market and register a revenue of $7,901.2 in year 2028, with a healthy CAGR of 7.9% during the forecast period. 
Small military drones can lift a payload up to 25 kg and are effective to perform computerized command, control, communication and information functions. These drones are very useful in the military as they can provide ISTAR (intelligence, surveillance, target acquisition and reconnaissance missions). These factors are expected to aid the growth of this sub-segment.

The medium drone’s sub-segment is estimated to have the fastest growth in the global market and register a revenue of $5,915.0 in year 2028, with a healthy CAGR of 8.3% during the forecast period. 
The medium range drones can lift weight up to 150 kg and are useful in situational analysis and awareness to offer protection and surveillance. They are also used in target acquisition and the assessment of some damage based on a given force. These factors are expected to aid the growth of this sub-segment 

Source: Research Dive Analysis

The intelligence, surveillance, reconnaissance, & target acquisition (ISRT) sub-segment is anticipated to have a dominating share in the global market and surpass $8,608.0 million by 2028, with an increase from $4,754.4 million in 2020. The increasing utilization of defense drones for intelligence gathering of potential threats for the military to provide video surveillance and threat monitoring is expected to aid the growth of this sub-segment in the forecast period. In recent developments, for instance, in September 2021, India and the United States signed an agreement to jointly develop an aerial unmanned aerial vehicle (ALUAV) or drone that can be launched from an aircraft. The agreement outlines the cooperation between the Air Force Research Laboratory, the Indian Air Force, and the Defense Research and Development Organization in the development, demonstration, testing, and evaluation of systems for the joint development of ALUAV prototypes. These factors are expected to aid the growth of this sub-segment.

The combat operations sub-segment of the global defense drone market is projected to have the fastest growth and register a revenue of $6,556.2 million in 2028 during the analysis timeframe, growing at a healthy CAGR of 8.1%. The growing need for upgradation of existing unmanned aerial attack systems for target identification and threat elimination missions in the military aviation is expected to aid the growth of combat operations sub-segment. 

Source: Research Dive Analysis

The short-range sub-segment is anticipated to have a dominating share in the global market and surpass $6,413.1 million by 2028, with an increase from $3,652.9 million in 2020.
The short range (up to 150 km) drones generate low noise due to which the adversaries are less likely to detect their presence. Second, drones can hover over an area longer than manned aircrafts. In the new developments, for instance, in 2021, the U.S. Army has chosen California-based drone manufacturer, Skydio, to continue in a final prototyping phase, which should lead to the company supplying the service’s first tranche of short-range reconnaissance unmanned aircraft systems. These factors are expected to aid the growth of this sub-segment.

The medium range sub-segment of the global defense drone market is projected to have the fastest growth and register a revenue of $6,039.6 million during the analysis timeframe, growing at a healthy CAGR of 8.6%. Mid-range defense drones can travel up to 650 km from their controller. The advantages of mid-range drones are that they have high endurance for operating for longer hours that is necessary for longer surveillance missions and they can perform both surveillance and combat operations. These factors are expected to aid the growth of this sub-segment.

Source: Research Dive Analysis

The Market for Defense Drone in North America to be the Most Dominating

The North America defense drone market generated $3,319.8   million in 2020 and is projected to register a revenue of $5,890.3 million by 2028. The North America region is expected to dominate the global defense drone market in the forecast period due to its well-established infrastructure in the military aviation along with strong emphasis on the research and development of defense drone in the civil aviation and military product type. These factors are expected to aid the growth of defense drone market in the North America region during the forecast period.

The Market for Defense Drone in Asia-Pacific to be the Fastest Growing

The Asia Pacific defense drone market generated $2,175.0 million in 2020 and is projected to register a revenue of $4,071.7 million by 2028. The growing military expenditure by the major countries in the region for defense drones in the armed forces is expected to aid the growth of defense drone market in the Asia-Pacific region. As per the "Stockholm International Peace Research Institute (SIPRI)" an independent international organization for research into conflict, armaments, and disarmament, countries such as China ($252 billion), India ($72.9 billion), Japan ($49.1 billion), South Korea ($45.7 billion), and Australia ($27.5 billion) increased their military expenditure in 2020. These factors are expected to aid the growth of defense drone market in the Asia-Pacific region.

Competitive Scenario in the Global Defense Drone Market

Agreement and acquisitions are common strategies followed by major market players.

Source: Research Dive Analysis

Some of the leading defense drone market players are Lockheed Martin Corporation, General Atomics Aeronautical Systems, Inc., Northrop Grumman Corporation, Elbit Systems Ltd., Israel Aerospace Industries Ltd., AeroVironment, Inc., Thales Group, Boeing, Textron Systems, and SAAB Group.

Top 10 countries with military drone technology

As the military drones are new weapons of the modern warfare, the top 10 countries with military drone technology are US, China, Russia, UK, France, Germany, India, Japan, Italy and South Korea. The latest developments in the domain of defence research and development have led to the utilization of emerging technologies such as hyperspectral imaging (HSI), infrared thermography (IRT), artificial intelligence powered UAVs, unmanned underwater vehicle (UUV) that can effectively operate in the water and others in the upcoming military drones. The major players in the military drone market are Textron, Northrop Grumman, General Atomics, and Boeing that account for major share of the global military drone’s market

Military drone

Military drone or unmanned combat aerial vehicle are used for surveillance, intelligence, reconnaissance, target acquisition and carries aircraft ordnance such as bombs and missiles for drone strikes. As per the market analysis global R&D and procurement expenditure on military drones is expected rise from USD 11.1 billion in 2020 to USD 14.3 billion by 2029. Moreover, the U.S. is expected to increase its R&D and procurement spending to USD 2.7 billion and USD 3.3 billion by 2029.

Porter’s Five Forces Analysis for the Global Defense Drone Market:

• Bargaining Power of Suppliers: The suppliers in the defense drone market are moderate in number. Several companies are working on new methodologies such as AI based defense drones to gain the major market share. Thus, there is moderate threat from the suppliers. 
  Thus, the bargaining power of suppliers is moderate.
• Bargaining Power of Buyers: Buyers have moderate bargaining power; they demand services at a cost-effective manner. This increases the pressure on the defense drone providers to offer the best service in a cost-effective way. Thus, buyers can have alternatives and choose the convenient service that best fits their preference. 
  Thus, the bargaining power of buyers is moderate.
• Threat of New Entrants: Companies entering the defense drone market face high competition since all new players strive to adopt technological innovations such as unmanned combat aerial vehicle, unmanned warfare, defense uav, anti uav defense system to customize products for attracting clients. The initial investment in the defense drone is high and technology is complex. 
  Thus, the threat of the new entrants is low.
• Threat of Substitutes: There is no alternative product for defense drone solutions. 
  Thus, the threat of substitutes is low.
• Competitive Rivalry in the Market: The competitive rivalry among industry leaders is rather intense, especially between the global players including Boeing and NORTHROP GRUMMAN CORPORATION. Companies in the defense drone do acquisitions to gain major market share. 
  Therefore, competitive rivalry in the market is high.