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Global Defense Survey 2013 - Business Outlook, Key Markets and Opportunities

"Global Defense Survey 2013: Business Outlook, Key Markets and Opportunities " is a new report by Strategic Defense Intelligence that provides the reader with a definitive analysis of business outlook in the global defense industry, and explores how key industry dynamics are set to change during 2013-2017. This report gives access to the key regions projected to witness the most defense opportunities, RandD budget outlook, future expectation from suppliers, business challenges, and key investment areas for the future. The report also identifies the emerging trends in the Aftermarket Service Support and MRO Area, MandA, staff hiring, and examines supplier strategies against decreasing defense expenditure. It not only grants access to the opinions and strategies of business decision makers and competitors, but also examines their actions surrounding business priorities, as well as access to information categorized by region, company type, and size.

Introduction and Landscape

Why was the report written?

This report is the result of an extensive survey drawn from Strategic Defense Intelligence's exclusive panel of leading global defense industry executives; it provides the reader with a definitive analysis of emerging trends in the global defense industry, and explores how key industry dynamics and collaborative projects are set to change during 2013-2017. In addition, the report examines the intentions of defense industry buyers and suppliers related to the top emerging and developed markets that will offer the strongest growth opportunities over the next five years. Furthermore, this report identifies the future investment opportunities within the defense industry, and not only grants access to change in defense RandD budgets, but also identifies the critical defense segments that will witness variations in budgets during 2013-2017.

What is the current market landscape and what is changing?

Survey results reveal that 61%, 54%, and 44% of buyer respondents identify ‘joint venture programs to decrease development cost', ‘cost-cutting measures', and ‘consolidation of operations' as the chief strategies that suppliers can adopt to deal with a decrease in defense expenditure, respectively.

What are the key drivers behind recent market changes?

Survey results reveal that in the next five years, buyer respondents require suppliers to ‘reduce prices', ‘engage in partnerships to optimize working capital and reduce costs', ‘offer more flexibility in delivery', and to help buyers in ‘product innovation'.

What makes this report unique and essential to read?

This report is the result of an extensive survey drawn from Strategic Defense Intelligence's exclusive panel of leading global defense industry executives. As most of the countries across the globe plan for defense budget cuts, defense organizations and contractors are initiating new alternatives for reducing their expenditure; this report provides data and analysis on the key factors influencing the business strategies within the global defense industry, and explores how key industry dynamics and collaborative projects are set to change during 2013-2017. Furthermore, the report analyses the regional market demand trends, country-specific growth prospects, potential segments with the most technological advancements within the global defense industry, and the impact of probable changes in global defense RandD budgets.

Key Features and Benefits

To identify prominent trends in the global defense industry that will shape business activities and strategies.

Analyzes the demand in regional markets and anticipates growth potential in respective countries.

Uncovers the key issues and challenges that restrain respondents from doing business.

Identifies buyer expectations and examines supplier strategies against decreasing defense expenditure.

Identifies the defense segments that will undergo the most technological advancement and attract the highest investment.

Key Market Issues

Overall, respondents from defense organizations identified China, India, and Brazil as the top three markets expected to offer the strongest growth opportunities to the defense industry over 2013-2017.

‘Budget cuts', ‘competitive pricing pressures', and ‘reverse engineering by countries like China and Iran' are the leading business concerns for the global defense industry in 2013.

Survey results reveal that respondents from defense contractors expect defense RandD budgets to decrease by -8.1% over the next five years as compared to 2012, with 69% of respondents anticipating a decline.

According to the survey results, 78%, 73%, and 56% of respondents from defense organizations identified ‘cyber warfare', ‘UAVs', and ‘soldier modernization' as the most important defense segments that will show the most technological advancement over the next decade.

Survey results show that ‘higher customization of service packages from suppliers', ‘international supplier certifications and quality', and ‘industry consolidation' are identified as the most significant global emerging trends in the Aftermarket Service Support and MRO area by buyers.

Key Highlights

Regardless of company type classification, a significant percentage of buyer and supplier respondents highlighted the ‘air force' and the ‘army' as the military forces that will record the highest spending in the next five years.

Overall, executives from the global defense industry anticipate increased levels of consolidation over the next two years, with 50% of respondents anticipating either a significant increase or a slight increase in MandA activity.

According to 28% of respondents from global defense contractor companies, the availability of skilled staff is still a major problem within their organizations, followed by 22% of respondents who confirm that though there are shortages of skilled staff within their organizations, the magnitude is slightly less than before.

Overall, respondents from the global defense industry identified Japan to offer the highest growth potential among developed countries during 2013-2017.

According to survey results, 66% of buyer respondents project that the number of collaborative projects in the global defense industry will increase over the next two years.

Table of Contents

1. Introduction

  • 1.1. What is this Report About?
  • 1.2. Definitions
  • 1.3. Summary Methodology
  • 1.4. About Strategic Defence Intelligence
  • 1.5. Profile of survey respondents
    • 1.5.1. Profile of buyer respondents
    • 1.5.2. Profile of supplier respondents

2. Executive Summary

3. Industry Dynamics in the Global Defense Industry

  • 3.1. Key Influential Trends in the Global Defense Industry
    • 3.1.1. Key influential trends by company type
    • 3.1.2. Key influential trends by region
    • 3.1.3. Key influential trends by company turnover
  • 3.2. Key Factors Influencing Business Strategies in the Global Defense Industry
    • 3.2.1. Key factors influencing business strategies by company type
    • 3.2.2. Key factors influencing business strategies by region
    • 3.2.3. Key factors influencing business strategies by company turnover
  • 3.3. MandA in the Global Defense Industry
    • 3.3.1. MandA in the global defense industry by company type
    • 3.3.2. MandA in the global defense industry by region
    • 3.3.3. MandA in the global defense industry by company turnover
  • 3.4. Staff Recruitment in the Global Defense Industry
    • 3.4.1. Staff recruitment in the global defense industry by company type
    • 3.4.2. Staff recruitment in the global defense industry by region
    • 3.4.3. Staff recruitment in the global defense industry by turnover
  • 3.5. Emerging Trends in Aftermarket Service Support and MRO
    • 3.5.1. Emerging trends in Aftermarket Service Support and MRO by buyers
    • 3.5.2. Emerging trends in Aftermarket Service Support and MRO by suppliers
    • 3.5.3. Emerging trends in Aftermarket Service Support and MRO by region
    • 3.5.4. Emerging trends in Aftermarket Service Support and MRO by turnover
  • 3.6. Future Expectations from Suppliers in the Global Defense Industry
    • 3.6.1. Future expectations from suppliers by company type
    • 3.6.2. Future expectations from suppliers by region
    • 3.6.3. Future expectations from suppliers by turnover
  • 3.7. Future of Collaborative Projects in the Global Defense Industry
    • 3.7.1. Future of collaborative projects by buyers
    • 3.7.2. Future of collaborative projects by suppliers
    • 3.7.3. Future of collaborative projects by region
    • 3.7.4. Future of collaborative projects by turnover

4. Global Defense industry Market Growth Outlook

  • 4.1. Regional Market Demand in the Defense Industry
    • 4.1.1. Regional market demand in the defense industry by company type
  • 4.2. Country Specific Growth Opportunities in the Global Defense Industry
    • 4.2.1. Country specific growth opportunities by buyers
    • 4.2.2. Country specific growth opportunities by suppliers
    • 4.2.3. Country specific growth opportunities in by region
    • 4.2.4. Country specific growth opportunities by company turnover
  • 4.3. Growth Expectations in Developed Countries in the Global Defense Industry
    • 4.3.1. Growth expectations in developed countries by buyers
    • 4.3.2. Growth expectations in developed countries by suppliers
    • 4.3.3. Growth expectations in developed countries by region
    • 4.3.4. Growth expectations in developed countries by company turnover

5. Threats and Opportunities for the Global Defense Industry

  • 5.1. The Global Defense Industry - Leading Business Concerns over 2013-2017
    • 5.1.1. Leading business concerns in the global defense industry by company type
    • 5.1.2. Leading business concerns in the global Defense industry by region
    • 5.1.3. Leading business concerns in the global Defense industry by company turnover
    • 5.1.4. Price vs. defense equipment purchases
    • 5.1.5. Defense segments to witness the most technological advancements by buyers
    • 5.1.6. Defense segments to witness maximum technological advancements by suppliers
    • 5.1.7. Defense segments to witness maximum technological advancements by region
    • 5.1.8. Defense segments to witness the most technological advancements by turnover
  • 5.2. Future Investment in Defense Segments
    • 5.2.1. Future investment in defense segments by buyers
    • 5.2.2. Future investments in defense segments by suppliers
    • 5.2.3. Future investments in defense segments by region
    • 5.2.4. Future investments in defense segments by company turnover
    • 5.2.5. Investment expectation by military force categories by company type
  • 5.3. Planned Change in RandD Budget in the Global Defense Industry
    • 5.3.1. Planned change in RandD budget by buyers
    • 5.3.2. Planned change in RandD budget by suppliers
    • 5.3.3. Planned change in RandD budget by region
    • 5.3.4. Planned change in RandD budget by company turnover
  • 5.4. Supplier Strategies against Decreasing Defense Expenditure
    • 5.4.1. Supplier strategies against decreasing defense expenditure by buyers
    • 5.4.2. Supplier strategies against decreasing defense expenditure by region

6. Appendix

  • 6.1. Full survey results
  • 6.2. Methodology
  • 6.3. Contact us
  • 6.4. About SDI
  • 6.5. Disclaimer

List of Tables

  • Table 1: Total Global Defense Industry Survey Respondents by Company Type, 2013
  • Table 2: Global Defense Industry Buyer Respondents by Region (%), 2013
  • Table 3: Supplier Respondents in the Global Defense Industry by Job Role (%), 2013
  • Table 4: Supplier Respondents in the Global Defense Industry by Region (%), 2013
  • Table 5: Supplier Respondents by Global Company Turnover (%), 2013
  • Table 6: Key Influential Trends in the Global Defense Industry (% All Respondents), 2013-2014
  • Table 7: Key Influential Trends in the Global Defense Industry by Company Type (%), 2013-2014
  • Table 8: Key Influential Trends in the Global Defense Industry by Region (%), 2013-2014
  • Table 9: Key Influential Trends in the Global Defense Industry by Turnover (%), 2013-2014
  • Table 10: Key Factors Driving Changes in Organization's Business Strategies by Company Type (%), 2013
  • Table 11: Key Factors Driving Changes in Organization's Business Strategies by Region (%), 2013
  • Table 12: Key Factors Driving Changes in Organization's Business Strategies by Turnover (%), 2013
  • Table 13: Global Defense Industry: MandA Activity (% All Respondents), 2013-2015
  • Table 14: Global Defense Industry: MandA Activity by Company Type (%), 2013-2015
  • Table 15: Global Defense Industry: MandA Activity by Region (%), 2013-2015
  • Table 16: Global Defense Industry: MandA Activity by Turnover (%), 2013-2015
  • Table 17: Planned Change in Staff Recruitment by Suppliers in the Global Defense Industry (%), 2013
  • Table 18: Planned Change in Staff Recruitment by Region (%), 2013
  • Table 19: Planned Change in Staff Recruitment by Company Turnover (%), 2013
  • Table 20: Emerging Trends in Aftermarket Service Support and MRO by Buyers (%), 2013
  • Table 21: Emerging Trends in Aftermarket Service Support and MRO by Defense Contractors (%), 2013
  • Table 22: Emerging Trends in Aftermarket Service Support and MRO by Other Service Providers (%), 2013
  • Table 23: Global Defense Industry - Future Expectations of Buyers vs. Suppliers (%), 2013-2017
  • Table 24: Anticipated Changes in Collaborative Projects by Defense Organizations (%), 2013-2014
  • Table 25: Anticipated Changes in Collaborative Projects by Suppliers (%), 2013-2014
  • Table 26: Key Anticipated Changes in Collaborative Projects by Turnover (%), 2013-2014
  • Table 27: Regional Market Demand in the Global Defense Industry (%), 2013-2017
  • Table 28: Country Specific Growth Opportunities in the Global Defense Industry by Buyers (%), 2013-2017
  • Table 29: Country Specific Growth Opportunities in the Global Defense Industry by Defense Contractors (%), 2013-2017
  • Table 30: Country Specific Growth Opportunities in the Global Defense Industry by Other Service Providers (%), 2013-2017
  • Table 31: Global Defense Industry - Country Specific Growth Opportunities by Region (%), 2013-2017
  • Table 32: Global Defense Industry - Country Specific Growth Opportunities by Turnover (%), 2013-2017
  • Table 33: Growth Expectations in Developed Countries by Defense Organizations (%), 2013-2017
  • Table 34: Growth Expectations in Developed Countries by Defense Contractors (%), 2013-2017
  • Table 35: Growth Expectations in Developed Countries by Other Service Providers (%), 2013-2017
  • Table 36: Leading Business Concerns in the Global Defense Industry (%) , 2013-2017
  • Table 37: Leading Business Concerns in the Global Defense Industry by Company Type (%), 2013-2017
  • Table 38: Global Defense Industry - Price vs. Defense Equipment Purchases by Company Type (%), 2013-2017
  • Table 39: Defense Segments to Witness Maximum Technological Advancements over the Next Decade (% Defense Organizations), 2013
  • Table 40: Defense Segments to Witness Maximum Technological Advancements Over the Next Decade - (%Supplier Respondents), 2013
  • Table 41: Future Investments in Defense Segments by Buyers (%), 2013-2017
  • Table 42: Future Investments in Defense Segments by Suppliers (%), 2013-2017
  • Table 43: Future Investment in Defense Segments by Region (%), 2013-2017
  • Table 44: Future Investment in Defense Segments by Turnover (%), 2013-2017
  • Table 45: Global Defense Military Forces - Expected Spending Trend by Company Type (%), 2013-2017
  • Table 46: Planned Change in RandD Budget in the Global Defense Industry by Buyers (%), 2013-2017
  • Table 47: Planned Change in RandD Budget in the Global Defense Industry by Suppliers (%), 2013-2017
  • Table 48: Planned Change in RandD Budget in the Global Defense Industry by Region (%), 2013-2017
  • Table 49: Planned Change in RandD Budget in the Global Defense Industry by Turnover (%), 2013-2017
  • Table 50: Supplier Strategies against Decreasing Defense Expenditure by Buyers (%), 2013
  • Table 51: Full Survey Results

List of Figures

  • Figure 1: Key Influential Trends in the Global Defense Industry (% All Respondents), 2013-2014
  • Figure 2: Key Influential Trends in the Global Defense Industry by Company Type (%), 2013-2014
  • Figure 3: Key Factors Driving Changes in Organization's Business Strategies by Company Type (%), 2013
  • Figure 4: Key Factors Driving Changes in Organization's Business Strategies by Region (%), 2013
  • Figure 5: Key Factors Driving Changes in Organization's Business Strategies by Turnover (%), 2013
  • Figure 6: Global Defense Industry: MandA Activity (% All Respondents), 2013-2015
  • Figure 7: Global Defense Industry: MandA Activity by Company Type (%), 2013-2015
  • Figure 8: Global Defense Industry: MandA Activity by Region (%), 2013-2015
  • Figure 9: Global Defense Industry: MandA Activity by Turnover (%), 2013-2015
  • Figure 10: Planned Change in Staff Recruitment by Suppliers in the Global Defense Industry (%), 2013
  • Figure 11: Planned Change in Staff Recruitment by Region (%), 2013
  • Figure 12: Emerging Trends in Aftermarket Service Support and MRO by Buyers (%), 2013
  • Figure 13: Emerging Trends in Aftermarket Service Support and MRO by Defense Contractors (%), 2013
  • Figure 14: Emerging Trends in Aftermarket Service Support and MRO by Other Service Providers (%), 2013
  • Figure 15: Most Significant Emerging Trends in Aftermarket Service Support and MRO by Region (%), 2013
  • Figure 16: Most Significant Emerging Trends in Aftermarket Service Support and MRO by Turnover (%), 2013
  • Figure 17: Global Defense Industry - Future Expectations of Buyers vs. Suppliers (%), 2013-2017
  • Figure 18: Future Expectations from Suppliers in the Global Defense Industry by Region (%), 2013-2017
  • Figure 19: Future Expectations from Suppliers in the Global Defense Industry by Turnover (%), 2013-2017
  • Figure 20: Anticipated Changes in Collaborative Projects by Defense Organizations (%), 2013-2014
  • Figure 21: Anticipated Changes in Collaborative Projects by Suppliers (%), 2013-2014
  • Figure 22: Key Anticipated Changes in Collaborative Projects by Region (%), 2013-2014
  • Figure 23: Key Anticipated Changes in Collaborative Projects by Turnover (%), 2013-2014
  • Figure 24: Regional Market Demand in the Global Defense Industry (%), 2013-2017
  • Figure 25: Global Defense Industry: Top Five Countries with Highest Growth Opportunities (All Respondents), 2013-2017
  • Figure 26: Country Specific Growth Opportunities in the Global Defense Industry by Buyers (%), 2013-2017
  • Figure 27: Country Specific Growth Opportunities in the Global Defense Industry by Defense Contractors (%), 2013-2017
  • Figure 28: Country Specific Growth Opportunities in the Global Defense Industry by Other Service Providers (%), 2013-2017
  • Figure 29: Global Defense Industry: Top Five Developed Markets by Growth (%), 2013-2017
  • Figure 30: Growth Expectations in Developed Countries by Defense Organizations (%), 2013-2017
  • Figure 31: Growth Expectations in Developed Countries by Defense Contractors (%), 2013-2017
  • Figure 32: Growth Expectations in Developed Countries by Other Service Providers (%), 2013-2017
  • Figure 33: Increase in Demand of Developed Countries: Global Defense Industry by Region (%), 2013-2017
  • Figure 34: Increase in Demand of Developed Countries: Global Defense Industry by Company Turnover (%) 2013-2017
  • Figure 35: Global Defense Industry: Top Five Leading Business Concerns, 2013-2017
  • Figure 36: Leading Business Concerns in the Global Defense Industry (%) , 2013-2017
  • Figure 37: Leading Business Concerns in the Global Defense Industry by Company Type (%), 2013-2017
  • Figure 38: Leading Business Concerns in the Global Defense Industry by Region (%), 2013-2017
  • Figure 39: Leading Business Concerns in the Global Defense Industry by Company Turnover (%), 2013-2017
  • Figure 40: Defense Segments to Witness Maximum Technological Advancements over the Next Decade (% Defense Organizations), 2013
  • Figure 41: Defense Segments to Witness Maximum Technological Advancements Over the Next Decade - (%Supplier Respondents), 2013
  • Figure 42: Defense Segments to Witness Maximum Technological Advancements over the Next Decade (% Region), 2013
  • Figure 43: Defense Segments to Witness The Most Technological Advancements over the Next Decade (% Turnover), 2013
  • Figure 44: Future Investments in Defense Segments by Buyers (%), 2013-2017
  • Figure 45: Future Investments in Defense Segments by Suppliers (%), 2013-2017
  • Figure 46: Global Defense Military Forces - Expected Spending Trend by Company Type (%), 2013-2017
  • Figure 47: Planned Change in RandD Budget in the Global Defense Industry by Buyers (%), 2013-2017
  • Figure 48: Planned Change in RandD Budget in the Global Defense Industry by Suppliers (%), 2013-2017
  • Figure 49: Planned Change in RandD Budget in the Global Defense Industry by Region (%), 2013-2017
  • Figure 50: Planned Change in RandD Budget in the Global Defense Industry by Turnover (%), 2013-2017
  • Figure 51: Supplier Strategies against Decreasing Defense Expenditure by Buyers (%), 2013
  • Figure 52: Supplier Strategies against Decreasing Defense Expenditure by Region (%), 2013
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