PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1880635
PUBLISHER: Fortune Business Insights Pvt. Ltd. | PRODUCT CODE: 1880635
The global precision guided munitions (PGMs) market is undergoing rapid transformation driven by rising geopolitical tensions, advancements in autonomous targeting, and increasing military modernization efforts. According to the latest analysis, the market was valued at USD 41.53 billion in 2024, reflecting growing worldwide demand for GPS-enabled, laser-guided, and radar-assisted munitions. In 2025, the market will rise to USD 44.60 billion, supported by defense modernization efforts across the U.S., Europe, Asia Pacific, and the Middle East. By 2032, the market is projected to reach USD 74.72 billion, registering a strong CAGR of 7.6% over the forecast period.
Precision guided munitions are weapons designed to accurately strike specific targets, minimizing collateral damage and enhancing operational efficiency. Their deployment spans multiple domains including land, air, and naval platforms, making them essential tools for modern military operations.
Market Drivers
Rising Defense Expenditure and Military Modernization
Global defense spending continues to surge due to heightened geopolitical tensions. Nations are prioritizing advanced weapons to modernize outdated arsenals, pushing demand for PGMs with GPS, inertial navigation, laser guidance, and infrared sensors. Countries such as the U.S., Russia, China, and members of NATO are increasingly integrating precision kits into traditional ammunition to upgrade existing stockpiles.
Influence of Regional Conflicts
Conflicts in Eastern Europe, the Middle East, and the Asia Pacific have amplified PGM usage. The Russia-Ukraine war accelerated demand for guided artillery shells, anti-tank missiles, and precision-strike drones. Similarly, the Israel-Iran conflict led to widespread deployment of precision bombs, pushing up procurement across Europe and the Middle East. The tension in the South China Sea further fuels investments in sea-launched PGMs.
Market Restraints
The development and procurement of PGMs involve complex integration, extensive testing, and high maintenance costs. Advanced systems such as AIM-9X, SDB II, and long-range smart missiles come with unit costs in the hundreds of thousands to millions of dollars. Sensor reliability and export restrictions also pose barriers, especially as weather, dust, and electronic interference can affect guidance accuracy.
Market Opportunities
AI and machine learning integration represents the next evolution of PGMs. Smart sensors capable of real-time target correction, autonomous decision-making, and multi-domain interoperability are creating new growth opportunities. Miniaturization and 3D printing enable production of lighter, more customizable PGMs, while dual-technology systems (combining GPS, INS, laser, and EO/IR guidance) are gaining traction.
Trends Shaping the Market
The development of smaller, more agile PGMs, including loitering munitions and drone-deployed micro-munitions, is transforming battlefield tactics. Investments in hypersonic weapons, autonomous targeting, and GPS-denied navigation systems are accelerating. For example, modern weapon programs now integrate AI-enabled seekers capable of tracking targets under complex battlefield conditions.
North America
North America led the market with USD 15.76 billion in 2024, driven by advanced military technologies, major defense OEMs, and continuous modernization initiatives. The U.S. plays a dominant role with large PGM procurement budgets and heavy investment in AI-enabled weapon systems.
Europe
Europe's market is expanding rapidly due to heightened security concerns following the Russia-Ukraine conflict. NATO's long-term commitment to increased defense spending is boosting demand for guided missiles, artillery shells, and loitering systems.
Asia Pacific
Asia Pacific is expected to record the fastest growth. Territorial disputes, especially in the South China Sea, along with increasing defense budgets in China, India, Japan, and South Korea, are driving investments in long-range precision strike systems.
Middle East & Rest of the World
High military spending in Saudi Arabia, UAE, and Israel continues to support PGM procurement. Latin America and Africa are slowly increasing purchases as defense modernization accelerates.
Conclusion
Growing from USD 41.53 billion in 2024 to a projected USD 74.72 billion by 2032, the precision guided munitions market is set for substantial expansion. Rising geopolitical instability, adoption of AI-driven targeting, increased investment in smart weapons, and modernization of land, air, and naval forces will shape the market's trajectory through 2032.
Segmentation
By Platform
By Operation Mode
By Type
By Systems
By Technology
By Speed
By Range
By Region