Cover Image

The Finnish Defense Industry: Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016

Notice
This publication has been discontinued on October 24, 2012.

Synopsis

Product Synopsis

This report is the result of SDI/ICD Research's extensive market and company research covering the Finnish defense industry. It provides detailed analysis of both historic and forecast defense industry values including key growth stimulators, analysis of the leading companies in the industry, and key news.

Introduction and Landscape

Why was the report written?

The Finnish Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016 offers the reader an insight into the market opportunities and entry strategies adopted by foreign original equipment manufacturers (OEMs) to gain a market share in the Finnish defense industry.

What is the current market landscape and what is changing?

The Finnish defense budget stood at US$3.93 billion in 2011 and recorded a CAGR of 6.44% during 2007-2011. Finnish defense expenditure is expected to decline at a CAGR of -1.53% during the forecast period as a result of the Euro zone crisis and the consequent Economy Management Plan by government. The high ratio of debt to GDP will lead to a decline in capital expenditure along with redundancies of defense personnel to control revenue expenses.

What are the key drivers behind recent market changes?

Finland's defense expenditure is primarily driven by military threat from Russia on the eastern border, the procurement of advanced air defense systems, and participation in international peacekeeping missions.

What makes this report unique and essential to read?

The Finnish Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016 provides detailed analysis of the current industry size and growth expectations from 2011 to 2016, including highlights of key growth stimulators. It also benchmarks the industry against key global markets and provides detailed understanding of emerging opportunities in specific areas.

Key Features and Benefits

The report provides detailed analysis of the current industry size and growth expectations from 2011 to 2016, including highlights of key growth stimulators. It also benchmarks the industry against key global markets and provides a detailed understanding of emerging opportunities in specific areas.

The report includes trend analysis of imports and exports, together with its implications and impact on the Finnish defense industry.

The report covers five forces analysis to identify various power centers in the industry and how these are expected to develop in the future.

The report allows readers to identify possible ways to enter the market, together with detailed descriptions of how existing companies have entered the market, including key contracts, alliances, and strategic initiatives.

The report helps the reader to understand the competitive landscape of the defense industry in Finland. It provides an overview of key defense companies, both domestic and foreign, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Key Market Issues

Finland has been perceived as a country with low levels of corruption. However, since 2006, three alleged instances of bribery and corruption involving the country's defense sector have been highlighted. As a result, the country's ranking in the Transparency International Corruption Perceptions Index has been dropping since 2007. Domestic defense industry officials are accused of handing out bribes to foreign public officials in order to win a contract for the supply of 126 armored personnel carriers to Croatia.

The Finnish defense budget deficit in 2011 stood at US$10.6 billion, due to which the country may be compelled to reduce its defense budget in the next ten years. Currently, the Ministry of Defense is contemplating reductions of US$300 million in its defense budget for 2012-13, which may eventually lead to the cancellation of defense-related projects and air defense modernization projects. A potential cut to Finland's defense budget is an area of concern for foreign investors.

Key Highlights

Finnish imports more than doubled from US$43 million to US$97 million during 2009-2011. Poland retained its position as the largest consumer of Finnish defense goods, and ships and armored vehicles constituted the majority of exports. In terms of imports, Finland focused on aircraft and tactical missiles during 2011 and is improving its air defense systems through large imports of anti-aircraft missiles and advanced radars, amounting to US$25 million in 2012.

The Finnish homeland security expenditure is anticipated to register a CAGR of 2.11% during the forecast period to reach an estimated US$1.93 billion by 2016. On a cumulative basis, Finland is expected to spend US$9.21 billion on its homeland security during the period 2012-2016. The nation's homeland security budget is focused on policing the increasing criminal activities in the nation, including the illicit drug trade and human trafficking across its eastern border with Russia.

In order to enhance domestic defense capabilities, the government encourages foreign investors to enter the Finnish defense industry by partnering with domestic defense firms. Defense firms such as United Shipbuilding Corp. of Russia and Saab of Sweden have entered the Finnish defense sector through this route. Additionally, domestic defense firms collaborate with foreign defense firms for military-related research and development (R&D) projects.

Table of Contents

1 Introduction

  • 1.1 What is this Report About?
  • 1.2 Definitions
  • 1.3 Summary Methodology
  • 1.4 SDI Terrorism Index
  • 1.5 About Strategic Defence Intelligence (www.strategicdefenceintelligence.com)

2 Executive Summary

3 Market Attractiveness and Emerging Opportunities

  • 3.1 Defense Market Size Historical and Forecast
    • 3.1.1 Finnish defense budget to decline at a CAGR of XX% during the forecast period
    • 3.1.2 Modernization initiatives, international peacekeeping missions and a perceived security threat from Russia will driving forces of Finnish defense expenditure
    • 3.1.3 Defense expenditure as a percentage of GDP to reach XX% by 2016
  • 3.2 Analysis of Defense Budget Allocation
    • 3.2.1 Capital expenditure allocation expected to decrease during the forecast period
    • 3.2.2 Share of Defense expenditure in GDP would reduce to XX% in 2016
    • 3.2.3 Finnish Defense expenditure to decline with weak growth of Finnish economy in 2012-2016
  • 3.3 Homeland Security Market Size and Forecast
    • 3.3.1 Homeland security market to register a growth with CAGR of XX% during 2012-2016
    • 3.3.2 Homeland security spending is expected to increase
    • 3.3.3 Finland considered a low risk country for terror activities
    • 3.3.4 Interesting trends in budget allocation of Ministry of Interior (MoI)
  • 3.4 Benchmarking with Key Global Markets
    • 3.4.1 Finnish defense budget to decrease at a low CAGR of XX% during 2012-2016
    • 3.4.2 Finnish defense expenditure is the small compared to leading spenders
    • 3.4.3 Finland behind on NATO specifications in defense spending
    • 3.4.4 Finland ranked twenty-second among top global arms exporters during 2007-2011
  • 3.5 Market Opportunities: Key Trends and Growth Stimulators
    • 3.5.1 Increasing offensive strength through higher imports of advanced missile systems
    • 3.5.2 Air Force modernization with special focus on securing Finnish airspace
    • 3.5.3 Finland to develop offensive strength of Cyber Defense Unit (CDU)
    • 3.5.4 Defense communication system will witness a surge in demand.

4 Defense Procurement Market Dynamics

  • 4.1 Import Market Dynamics
    • 4.1.1 Defense imports expected to increase during the forecast period
    • 4.1.2 Sweden is the major supplier to Finland
    • 4.1.3 Aircraft and missiles constitute the majority of Finnish arms imports
  • 4.2 Export Market Dynamics
    • 4.2.1 Finnish exports recovering from fall in 2009
    • 4.2.2 EU countries account for a majority of Finnish defense exports
    • 4.2.3 Armored vehicles are the largest exported defense hardware

5 Industry Dynamics

  • 5.1 Five Forces Analysis
    • 5.1.1 Bargaining power of supplier: low to high
    • 5.1.2 Bargaining power of buyer: high
    • 5.1.3 Barrier to entry: medium
    • 5.1.4 Intensity of rivalry: low to high
    • 5.1.5 Threat of substitution: low to high

6 Market Entry Strategy

  • 6.1 Market Regulation
    • 6.1.1 Government encourages offsets in order to order to develop domestic defense industrial base
    • 6.1.2 Finnish defense sector is open to foreign direct investments
  • 6.2 Market Entry Route
    • 6.2.1 Partnerships with domestic defense firms offer attractive market entry route
    • 6.2.2 Foreign OEMs gain industry access through joint R&D programs
  • 6.3 Key Challenges
    • 6.3.1 Defense budget fluctuations challenging the domestic defense industry
    • 6.3.2 Defense budget deficit may lead to a reduction in the overall military budget

7 Competitive Landscape and Strategic Insights

  • 7.1 Competitive Landscape Overview
  • 7.2 Key Public sector companies
    • 7.2.1 Elektrobit Corporation: overview
    • 7.2.2 Elektrobit Corporation: products and services
    • 7.2.3 Elektrobit Corporation: recent announcements and strategic initiatives
    • 7.2.4 Elektrobit Corporation: alliances
    • 7.2.5 Elektrobit Corporation: recent contract wins
    • 7.2.6 Elektrobit Corporation: financial analysis
    • 7.2.7 Kiitokori Oy: overview
    • 7.2.8 Kiitokori Oy: products and services
    • 7.2.9 Kiitokori Oy: recent announcements and strategic initiatives
    • 7.2.10 Millog Oy: overview
    • 7.2.11 Millog Oy: products and services
    • 7.2.12 Millog Oy: recent announcements and strategic initiatives
    • 7.2.13 Millog Oy: alliances
    • 7.2.14 Millog Oy: recent contract wins
    • 7.2.15 Nammo Lapua Oy: overview
    • 7.2.16 Nammo Lapua Oy: products and services
    • 7.2.17 Nammo Lapua Oy: recent announcements and strategic initiatives
    • 7.2.18 Nammo Lapua Oy: recent contract wins
    • 7.2.19 Patria Aviation Oy: overview
    • 7.2.20 Patria Aviation Oy: products and services
    • 7.2.21 Patria Aviation Oy: alliances
    • 7.2.22 Patria Aviation Oy: recent contract wins
    • 7.2.23 Patria Land Services Oy: overview
    • 7.2.24 Patria Land Services Oy: products and services
    • 7.2.25 Patria Land Services Oy: recent contract wins
    • 7.2.26 Patria Oyj: overview
    • 7.2.27 Patria Oyj: products and services
    • 7.2.28 Patria Oyj: recent announcements and strategic initiatives
    • 7.2.29 Patria Oyj: alliances
    • 7.2.30 Patria Oyj: recent contract wins
    • 7.2.31 Patria Oyj: financial analysis
    • 7.2.32 Patricomp Oy: overview
    • 7.2.33 Patria Oyj: products and services
    • 7.2.34 Patricomp Oy: recent announcements and strategic initiatives
    • 7.2.35 Patricomp Oy: recent contract wins
    • 7.2.36 TEMET Oy: overview
    • 7.2.37 TEMET Oy: products and services

8 Business Environment and Country Risk

  • 8.1 Demographics & Social Statistics
    • 8.1.1 Population - Female
    • 8.1.2 Population - Male
  • 8.2 Economic Performance
    • 8.2.1 Construction Output, Current Prices, Local Currency
    • 8.2.2 Construction Output, Current Prices, US Dollars
    • 8.2.3 Current Account Balance as Percentage of GDP
    • 8.2.4 Exports of goods and services, current prices
    • 8.2.5 Exports of Services
    • 8.2.6 Fiscal Balance as a percentage of GDP
    • 8.2.7 Foreign Direct Investment
    • 8.2.8 GDP at Purchasing Power Parity
    • 8.2.9 GDP, Constant Prices (Local Currency)
    • 8.2.10 GDP, Constant Prices (US$)
    • 8.2.11 GDP, Current Prices (Local Currency)
    • 8.2.12 GDP, Current Prices (US$)
    • 8.2.13 General Government Final Consumption Expenditure
    • 8.2.14 Gross Fixed Capital Formation, Current Prices
    • 8.2.15 Imports of goods and services
    • 8.2.16 Imports of Services
    • 8.2.17 Inflation, average consumer prices
    • 8.2.18 Manufacturing Output, Current Prices (Local Currency Bn)
    • 8.2.19 Manufacturing Output, Current Prices (US$ Billions)
    • 8.2.20 Wholesale Price Index
  • 8.3 Energy and Utilities
    • 8.3.1 Crude Oil Distillation Capacity
    • 8.3.2 Electricity Exports
    • 8.3.3 Electricity Imports
    • 8.3.4 Electricity Installed Capacity
    • 8.3.5 Hydroelectricity Installed Capacity
    • 8.3.6 Natural Gas Consumption
    • 8.3.7 Natural Gas Imports
    • 8.3.8 Net Conventional Thermal Electricity Generation
    • 8.3.9 Net Geothermal, Solar, Wind, and Wood Electric Power Generation
    • 8.3.10 Net Hydroelectric Power Generation
    • 8.3.11 Nuclear Electricity Net Generation
    • 8.3.12 Petroleum, Consumption
    • 8.3.13 Petroleum, Production
  • 8.4 Labor Force
    • 8.4.1 People Employed in R & D
  • 8.5 Minerals
    • 8.5.1 Coal Consumption
  • 8.6 Social & Political Risk
    • 8.6.1 Political Stability Index
    • 8.6.2 Transparency Index
  • 8.7 Telecommunication
    • 8.7.1 Fixed line calling cost local
    • 8.7.2 Fixed line calling cost National

9 Appendix

  • 9.1 Contact Us
  • 9.2 About SDI
  • 9.3 Disclaimer

List of Tables

  • Table 1: Finnish Defense Expenditure, 2007-2011
  • Table 2: Finnish Defense Expenditure, 2012-2016
  • Table 3: Finnish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2007-2011
  • Table 4: Finnish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2012-2016
  • Table 5: Finland's Defense Budget Split Between Capital and Revenue Expenditure (%), 2007-2011
  • Table 6: Finland's Defense Budget Split Between Capital and Revenue Expenditure (%), 2012-2016
  • Table 7: Finnish Defense Budget as Percentage of GDP, 2007-2011
  • Table 8: Finland's Defense Budget as Percentage of GDP, 2012-2016
  • Table 9: Growth Rate of Finnish Defense Expenditure and GDP (%), 2007-2011
  • Table 10: Growth Rate of Defense Budget and GDP (%), 2012-2016
  • Table 11: Finnish Homeland Security Expenditure (US$ billion), 2007-2011
  • Table 12: Finnish Homeland Security Expenditure (US$ billion), 2012-2016
  • Table 13: Benchmarking with Key Markets - 2007-2011 vs. 2012-2016
  • Table 14: Top Twenty Global Arms Exporters*, 2007-2011
  • Table 15: Offset Regulations in Finland
  • Table 16: Offset multiplier categories
  • Table 17: Market Entry Strategies by Key Foreign Companies
  • Table 18: Elektrobit Corporation - Product Focus
  • Table 19: Elektrobit Corporation - Alliances
  • Table 20: Elektrobit Corporation - Recent Contract Wins
  • Table 21: Kiitokori Oy- Product Focus
  • Table 22: Millog Oy - Product Focus
  • Table 23: Millog Oy - Alliances
  • Table 24: Millog Oy - Recent Contract Wins
  • Table 25: Nammo Lapua Oy - Product Focus
  • Table 26: Nammo Lapua Oy - Recent Contract Wins
  • Table 27: Patria Aviation Oy - Product Focus
  • Table 28: Patria Aviation Oy - Alliances
  • Table 29: Patria Aviation Oy - Recent Contract Wins
  • Table 30: Patria Land Services Oy - Product Focus
  • Table 31: Patria Land Services Oy - Recent Contract Wins
  • Table 32: Patria Oyj - Product Focus
  • Table 33: Patria Oyj - Alliances
  • Table 34: Patria Oyj - Recent Contract Wins
  • Table 35: Patricomp Oy - Product Focus
  • Table 36: Patricomp Oy - Recent Contract Wins
  • Table 37: TEMET Oy - Product Focus

List of Figures

  • Figure 1: Finnish Defense Expenditure, 2007-2011
  • Figure 2: Finnish Defense Expenditure, 2012-2016
  • Figure 3: Finnish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure Percentage of GDP Growth, 2007-2011
  • Figure 4: Finnish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as a Percentage of GDP Growth, 2012-2016
  • Figure 5: Finland's Defense Budget Split Between Capital and Revenue Expenditure (%), 2007-2011
  • Figure 6: Finland's Defense Budget Split Between Capital and Revenue Expenditure (%), 2012-2016
  • Figure 7: Finnish Defense Budget as Percentage of GDP, 2007-2011
  • Figure 8: Finland's Defense Budget as Percentage of GDP, 2012-2016
  • Figure 9: Growth Rate of Finnish Defense Expenditure and GDP (%), 2007-2011
  • Figure 10: Growth Rate of Defense Budget and GDP (%), 2012-2016
  • Figure 11: Finnish Homeland Security Expenditure (US$ billion), 2007-2011
  • Figure 12: Finnish Homeland Security Expenditure (US$ billion), 2012-2016
  • Figure 13: SDI Terrorism Heat Map, 2011
  • Figure 14: SDI Terrorism Index, 2011
  • Figure 15: Benchmarking with Key Markets - 2007-2011 vs. 2012-2016
  • Figure 16: Defense Expenditure of the Largest Military Spenders in the World (US$ billion), 2011 and 2016
  • Figure 17: Finnish Defense Expenditure as Percentage of GDP on Global Scale, 2011
  • Figure 18: Finnish Defense Imports (US$ million), 2007-2011
  • Figure 19: Finnish Defense Imports by Country (%), 2007-2011
  • Figure 20: Finnish Defense Imports by Category, 2007-2011
  • Figure 21: Finnish Defense Export Trend (US$ Million), 2007-2011
  • Figure 22: Finnish Defense Exports by Country (%), 2007-2011
  • Figure 23: Finnish Defense Exports by Category, 2007-2011
  • Figure 24: Industry Dynamics - Porter's Five Forces Analysis
  • Figure 25: Elektrobit Corporation - Revenue Trend Analysis, 2007-2011
  • Figure 26: Elektrobit Corporation - Operating Profit Analysis, 2007-2011
  • Figure 27: Elektrobit Corporation - Net Profit Analysis, 2007-2011
  • Figure 28: Patria Oyj - Revenue Trend Analysis (EUR Million), 2007-2011
  • Figure 29: Patria Oyj - Operating Profit Trend Analysis (EUR Million), 2006-2011
  • Figure 30: Finnish Population - Female (In Millions), 2008-2017
  • Figure 31: Finnish Population - Male (In Millions), 2008-2017
  • Figure 32: Finnish Construction Output, Current Prices, Local Currency (In Billions), 2001-2010
  • Figure 33: Finnish Construction Output, Current Prices, US Dollars (In Billions), 2001-2010
  • Figure 34: Finnish Current Account Balance as Percentage of GDP, 2008-2017
  • Figure 35: Finnish Exports of goods and services, current prices (US$ Billion), 2001-2010
  • Figure 36: Finnish Exports of Services (In Local Currency Billion), 2003-2012
  • Figure 37: Finnish Fiscal Balance as a percentage of GDP, 2001-2008
  • Figure 38: Finnish Foreign Direct Investment (US$ Billion), 2001-2010
  • Figure 39: Finnish GDP at Purchasing Power Parity (US$ Billion), 2006-2015
  • Figure 40: Finnish GDP at Constant Prices (Local Currency Billion), 2006-2015
  • Figure 41: Finnish GDP at Constant Prices (US$ Billion), 2006-2015
  • Figure 42: Finnish GDP at Current Prices (Local Currency Billion), 2006-2015
  • Figure 43: Finnish GDP at Current Prices (US$ Billion), 2006-2015
  • Figure 44: Finnish General Government Final Consumption Expenditure (US$ Billion), 2001-2010
  • Figure 45: Finnish Gross Fixed Capital Formation, Current Prices (US$ Billion), 2001-2010
  • Figure 46: Finnish Imports of goods and services (current US$ Billion), 2003-2012
  • Figure 47: Finnish Imports of Services (Local Currency in Billion), 2003-2012
  • Figure 48: Finnish Inflation, average consumer prices, 2008-2017
  • Figure 49: Finnish Manufacturing Output, Current Prices (Local Currency Billion), 2001-2010
  • Figure 50: Finnish Manufacturing Output, Current Prices (US$ Billion), 2001-2010
  • Figure 51: Finnish Wholesale Price Index, 2000-2009
  • Figure 52: Finnish Crude Oil Distillation Capacity (Thousand Barrels Per Cal Day), 2000-2009
  • Figure 53: Finnish Electricity Exports (Billion Kilowatt hours), 2001-2010
  • Figure 54: Finnish Electricity Imports (Billion Kilowatt hours), 2001-2010
  • Figure 55: Finnish Electricity Installed Capacity (Million Kilowatts), 2000-2009
  • Figure 56: Finnish Hydroelectricity Installed Capacity (Million Kilowatts), 2000-2009
  • Figure 57: Finnish Natural Gas Consumption (Billion Cubic Feet), 2001-2010
  • Figure 58: Finnish Natural Gas Imports (Billion Cubic Feet), 2001-2010
  • Figure 59: Finnish Net Conventional Thermal Electricity Generation (Billion Kilowatt hours), 2001-2010
  • Figure 60: Finnish Net Geothermal, Solar, Wind, and Wood Electric Power Generation(Billion Kilowatt hours), 2001-2010
  • Figure 61: Finnish Net Hydroelectric Power Generation (Billion Kilowatt hours), 2001-2010
  • Figure 62: Finnish Nuclear Electricity Net Generation (Billion Kilowatt hours), 2001-2010
  • Figure 63: Finnish Petroleum Consumption (Thousand Barrels Per Day), 2002-2011
  • Figure 64: Finnish Petroleum Production (Thousand Barrels Per Day), 2002-2011
  • Figure 65: Finnish People Employed in R & D (Number of researchers per million people), 2000-2009
  • Figure 66: Finnish Coal Consumption (Thousand Short Tons), 2001-2010
  • Figure 67: Finnish Political Stability Index, 2002-2010
  • Figure 68: Finnish Transparency Index, 2002-2011
  • Figure 69: Finnish Fixed line calling cost local (Euro per 10 min call), 2001-2010
  • Figure 70: Finnish Fixed line calling cost National (Euro per 10 min call), 2001-2010
Show More
Pricing
Not Available
Get Notified
Email me when related reports are published