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Market Research Report

Future of the Spanish Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

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Future of the Spanish Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023
Published: June 28, 2018 Content info: 135 Pages
Description

Summary

Spanish defense exports ranked seventh largest in the world, accounting for 2.9% of the world's deliveries. During 2013-2017, Spain enhanced its aerospace and naval sectors significantly and, as a result, aircraft and naval vessels accounted for the majority of defense exports, occupying 60.6% and 34.5%, respectively. Australia was the largest recipient, occupying 34.2% of Spanish defense exports, followed by Turkey and Saudi Arabia.

The Spanish defense industry, which values US$10.2 billion in 2018, is anticipated to grow at a CAGR of 7.09% over the forecast period to reach US$14 billion in 2023. The country was facing a fiscal debt due to its economic slowdown, which resulted in a cut in military procurements during 2015-2016. However, in 2017, Spain's defense expenditure started to recover and is anticipated to grow over the forecast period driven by the country's existing military procurement programs, security threats from terrorist organizations, and territorial disputes with Morocco. The country's defense budget is anticipated to average 0.7% of GDP over the forecast period.

The independence referendum by Catalonia, which resulted in heightened political tensions, caused Spain to go down by 10 ranks in Global Peace Index. The forecast period is expected to witness enhanced opportunities in security systems and its related platforms.

The Spanish Ministry of Defence (MoD) is making an effort to modernize its armed forces and support its existing projects. Capital expenditure is expected to increase to US$2.2 billion in 2023. The Defense Ministry is expected to procure A400M military transport aircraft, S-80 submarines, Eurofighter typhoons, Buque de Accion Maritima (BAM) ocean-going patrol boats, Tiger helicopters, medium-to-heavy military trucks, cyber security, and UAVs.

The report "Future of the Spanish Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023" offers detailed analysis of the Spanish defense industry with market size forecasts covering the next five years. This report will also analyze factors that influence demand for the industry, key market trends, and challenges faced by industry participants.

Companies Mentioned - Thales, Iveco, Navantia, General Dynamics European Land Systems (GDELS), Aernnova Aerospace S.A., Aries Ingenieria Y Sistemas, S.A., Indra Sistemas S.A., Sociedad Anonima De Electronica Submarina, S.A., Tecnobit, Uro Vehiculos Especiales S.A. and Amper S.A.

Scope

Spanish Defense Industry Market Size and Drivers: detailed analysis of the Spanish defense industry during 2019-2023, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the country's expenditure and modernization patterns

Budget Allocation and Key Challenges: insights into procurement schedules formulated within the country and a breakdown of the defense budget with respect to capital expenditure and revenue expenditure. It also details the key challenges faced by defense market participants within the country

Import and Export Dynamics: analysis of prevalent trends in the country's imports and exports over the last five years

Market Opportunities: list of the top ten defense investment opportunities over the next 5 years

Competitive Landscape and Strategic Insights: analysis of the competitive landscape of the Spanish defense industry.

Reasons to buy

This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Spanish defense industry market trends for the coming five years

The market opportunity section will inform the user about the various military requirements that are expected to generate revenues during the forecast period. The description includes technical specifications, recent orders, and the expected investment pattern by the country during the forecast period

Profiles of the top domestic and foreign defense manufacturers. This will provide the user with a total competitive landscape of the sector

A deep qualitative analysis of the Spanish defense industry covering sections including demand drivers, Key Trends, and latest industry contracts

Table of Contents
Product Code: DF0505MR

Table of Contents

1. Introduction 9

  • 1.1. What is this Report About? 9
  • 1.2. Definitions 9
  • 1.3. Summary Methodology 11
  • 1.4. About Strategic Defence Intelligence 12

2. Executive Summary 13

3. Market Attractiveness and Emerging Opportunities 15

  • 3.1. Current Market Scenario 16
    • 3.1.1. Primary threat perception 16
    • 3.1.2. Military Doctrine and Strategy 17
    • 3.1.3. Military Fleet Size 18
    • 3.1.4. Procurement Programs 22
    • 3.1.5. Ongoing procurement programs 22
    • 3.1.6. Future procurement programs 23
    • 3.1.7. Top Procurement Programs by Value (US$ Million) 2018-2023 24
    • 3.1.8. Social, Political and Economic Environment and Support for Defense Projects 25
    • 3.1.9. Political and Strategic Alliances 26
  • 3.2. Defense Market Size - Historical and Forecast 27
    • 3.2.1. Spanish defense budget is expected to grow at a CAGR of 7.09% over the forecast period 27
    • 3.2.2. Territorial dispute with Morocco, security threats posed by terrorist organizations, and large equipment procurement programs will drive defense expenditure over the forecast period 29
  • 3.3. Analysis of Defense Budget Allocation 31
    • 3.3.1. Revenue expenditure accounts for the largest percentage share 31
    • 3.3.2. Capital expenditure expected to increase at a CAGR of 9.22% over 2019-2023 33
    • 3.3.3. Defense expenditure as a percentage of GDP is expected to reach 0.75% in 2023 35
    • 3.3.4. Per capita defense expenditure set to increase over the forecast period 37
  • 3.4. Homeland Security Market Size and Forecast 38
    • 3.4.1. Homeland security expenditure is expected to register a CAGR of 2.28% over the forecast period 38
    • 3.4.2. Border security and drug trafficking will drive homeland security expenditure in Spain 40
    • 3.4.3. Spain is at "some risk" of terrorism 41
    • 3.4.4. Spain faces some level of threat from foreign terrorist organizations 42
    • 3.4.5. Spain has a terrorism index score of 1.7 44
  • 3.5. Benchmarking with Key Global Markets 45
    • 3.5.1. Spanish defense expenditure expected to increase over the forecast period 45
    • 3.5.2. The country's defense budget is relatively small compared to other leading spenders 47
    • 3.5.3. Spanish defense expenditure as a percentage of GDP is expected to increase over the forecast period 48
  • 3.6. Market Opportunities: Key Trends and Drivers 49
    • 3.6.1. Top 10 Defense Market Categories by Value (US$ Million) - Forecast-Period Projections 49
    • 3.6.2. Land-based C4ISR 50
    • 3.6.3. Physical Security 51
    • 3.6.4. Multirole Aircraft 52

4. Defense Procurement Market Dynamics 53

  • 4.1. Import Market Dynamics 55
    • 4.1.1. Spanish defense imports are expected to grow moderately over the forecast period 55
    • 4.1.2. Germany emerged as a significant arms supplier to Spain 56
    • 4.1.3. Missiles and aircraft dominate military hardware imports 57
  • 4.2. Export Market Dynamics 58
    • 4.2.1. Spain ranked seventh among the countries with the highest volume of defense exports 58
    • 4.2.2. Australia accounted for the largest percentage share of Spanish defense exports 59
    • 4.2.3. Aircraft and naval vessels are the main exported defense products 60

5. Industry Dynamics 61

  • 5.1. Five Forces Analysis 61
    • 5.1.1. Bargaining Power of Supplier: Low 62
    • 5.1.2. Bargaining Power of Buyer: Medium 62
    • 5.1.3. Barrier to Entry: Medium 62
    • 5.1.4. Intensity of Rivalry: High 62
    • 5.1.5. Threat of Substitution: High 62

6. Market Entry Strategy 63

  • 6.1. Market Regulation 63
    • 6.1.1. Offset policy mandates suppliers invest 100% of the contract value into the Spanish economy 63
    • 6.1.2. FDI in defense subject to approval 64
    • 6.1.3. Unified Procurement Policy 64
  • 6.2. Market Entry Route 65
    • 6.2.1. Budgeting Process 65
    • 6.2.2. Procurement Policy and Process 66
    • 6.2.3. Foreign OEMs venture into the market by partnering with domestic defense firms 67
    • 6.2.4. Joint R&D provides an attractive entry route to foreign OEMs 68
    • 6.2.5. Collaborations provide market entry opportunities 68
  • 6.3. Key Challenges 69
    • 6.3.1. Defense budget cuts discourage investors from entering the industry 69
    • 6.3.2. Project delays deter defense industry growth 69

7. Competitive Landscape and Strategic Insights 70

  • 7.1. Competitive Landscape Overview 70
  • 7.2. Competitive Landscape Overview 73
  • 7.3. Key Foreign Companies 74
    • 7.3.1. Thales: Overview 74
    • 7.3.2. Thales: Key Products 74
    • 7.3.3. Thales: Recent Announcements and Strategic Initiatives 75
    • 7.3.4. Thales: Alliances 76
    • 7.3.5. Thales: Recent Contract Wins 77
    • 7.3.6. Thales: Financial Analysis 79
    • 7.3.7. Iveco: Overview 81
    • 7.3.8. Iveco: Key Products 81
    • 7.3.9. Iveco: Recent Announcements and Strategic Initiatives 81
    • 7.3.10. Iveco: Alliances 82
    • 7.3.11. Iveco: Recent Contract Wins 82
  • 7.4. Key Public Sector Companies 83
    • 7.4.1. Navantia: Overview 83
    • 7.4.2. Navantia: Key Products 83
    • 7.4.3. Navantia: Recent Announcements and Strategic Initiatives 85
    • 7.4.4. Navantia: Alliances 86
    • 7.4.5. Navantia: Recent Contract Wins 87
  • 7.5. Key Private Sector Companies 89
    • 7.5.1. General Dynamics European Land Systems (GDELS): Overview 89
    • 7.5.2. General Dynamics European Land Systems (GDELS): Key Products 89
    • 7.5.3. General Dynamics European Land Systems (GDELS): Recent Announcements and Strategic Initiatives 89
    • 7.5.4. General Dynamics European Land Systems (GDELS): Alliances 90
    • 7.5.5. General Dynamics European Land Systems (GDELS): Recent Contract Wins 91
    • 7.5.6. Aernnova Aerospace S.A.: Overview 93
    • 7.5.7. Aernnova Aerospace S.A.: Key Products 93
    • 7.5.8. Aernnova Aerospace S.A.: Recent Announcements and Strategic Initiatives 94
    • 7.5.9. Aernnova Aerospace S.A: Alliances 94
    • 7.5.10. Aernnova Aerospace S.A.: Recent Contract Wins 95
    • 7.5.11. Aries Ingenieria Y Sistemas, S.A.: Overview 96
    • 7.5.12. Aries Ingenieria Y Sistemas, S.A.: Key Products 96
    • 7.5.13. Aries Ingenieria Y Sistemas, S.A.: Recent Announcements and Strategic Initiatives 97
    • 7.5.14. Aries Ingenieria Y Sistemas, S.A: Alliances 97
    • 7.5.15. Indra Sistemas S.A.: Overview 98
    • 7.5.16. Indra Sistemas SA: Key Products 98
    • 7.5.17. Indra Sistemas S.A.: Recent Announcements and Strategic Initiatives 99
    • 7.5.18. Indra Sistemas S.A.: Alliances 100
    • 7.5.19. Indra Sistemas S.A.: Recent Contract Wins 101
    • 7.5.20. Indra Sistemas S.A.: Financial Analysis 103
    • 7.5.21. Sociedad Anonima De Electronica Submarina, S.A.: Overview 105
    • 7.5.22. Sociedad Anonima De Electronica Submarina, S.A.: Key Products 105
    • 7.5.23. Sociedad Anonima De Electronica Submarina, S.A.: Recent Announcements and Strategic Initiatives 106
    • 7.5.24. Sociedad Anonima De Electronica Submarina, S.A.: Alliances 106
    • 7.5.25. Sociedad Anonima De Electronica Submarina, S.A.: Recent Contract Wins 107
    • 7.5.26. Tecnobit: Overview 108
    • 7.5.27. Tecnobit: Key Products 108
    • 7.5.28. Tecnobit: Recent Announcements and Strategic Initiatives 110
    • 7.5.29. Tecnobit: Alliances 110
    • 7.5.30. Tecnobit: Recent Contract Wins 111
    • 7.5.31. Uro Vehiculos Especiales S.A.: Overview 112
    • 7.5.32. Uro Vehiculos Especiales S.A.: Key Products 112
    • 7.5.33. Uro Vehiculos Especiales S.A.: Recent Announcements and Strategic Initiatives 112
    • 7.5.34. Uro Vehiculos Especiales S.A.: Recent Contract Wins 113
    • 7.5.35. Amper S.A.: Overview 114
    • 7.5.36. Amper S.A.: Key Products 114
    • 7.5.37. Amper S.A.: Recent Announcements and Strategic Initiatives 115
    • 7.5.38. Amper S.A.: Alliances 115
    • 7.5.39. Amper S.A.: Recent Contract Wins 116
    • 7.5.40. Amper S.A.: Financial Analysis 117

8. Business Environment and Country Risk 119

  • 8.1. Economic Performance 119
    • 8.1.1. GDP Per Capita at Constant Prices 119
    • 8.1.2. GDP at Current Prices (US$ Billion) 120
    • 8.1.3. Exports of Goods and Services (current LCU Billion) 121
    • 8.1.4. Imports of Goods and Services (current LCU Billion) 122
    • 8.1.5. Gross National Disposable Income (US$ Billion) 123
    • 8.1.6. LCU per US$ (period average) 124
    • 8.1.7. Market Capitalization of Listed Companies (US$ Billion) 125
    • 8.1.8. Market Capitalization of Listed Companies (% of GDP) 126
    • 8.1.9. Government Cash Surplus/Deficit as a Percentage of GDP (LCU) 127
    • 8.1.10. Goods Exports as a Percentage of GDP 128
    • 8.1.11. Goods Imports as a Percentage of GDP 129
    • 8.1.12. Services Imports as a Percentage of GDP 130
    • 8.1.13. Service Exports as a Percentage of GDP 131
    • 8.1.14. Foreign Direct Investment, net (BoP, current US$ Billion) 132
    • 8.1.15. Net Foreign Direct Investment as a Percentage of GDP 133
    • 8.1.16. Mining, Manufacturing, Utilities Output (LCU Billion) 134

9. Appendix 135

  • 9.1. About SDI 135
  • 9.2. Disclaimer 135

List of Tables

  • Table 1: The Spanish Army Strength 18
  • Table 2: Spanish Navy Strength 20
  • Table 3: Spanish Air Force Strength 21
  • Table 4: Spain - Ongoing Procurement Programs 22
  • Table 5: Spain - Future Procurement Programs 23
  • Table 6: Spanish - Defense Procurement Programs by Value (US$ Million) 2018-2023 24
  • Table 7: Spanish Defense Expenditure (EUR Billion and US$ Billion), 2014-2023 27
  • Table 8: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023 31
  • Table 9: Spanish - Defense Capital Expenditure (EUR Million and US$ Million), 2014-2023 33
  • Table 10: Spanish - GDP Growth vs Defense Expenditure as a Percentage of GDP, 2014-2023 35
  • Table 11: Spanish Per Capita Defense Expenditure (US$), 2014-2023 37
  • Table 12: Spanish - Homeland Security Expenditure (EUR Billion and US$ Billion), 2014-2023 38
  • Table 13: Terrorism Index, 2018 42
  • Table 14: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023 45
  • Table 15: Spain's - 10 Leading Defense Market Categories by Value (US$ Million) - 2018-2023 49
  • Table 16: Spanish Defense Offset Regulations 64
  • Table 17: Spanish Budget Formation Timetable 65
  • Table 18: Market Entry Strategies by Key Foreign Companies 67
  • Table 19: Competitive Landscape of the Spanish Defense Industry 70
  • Table 20: Spain - Top 10 Defense Suppliers by Value (US$ Million), 2018-2023 73
  • Table 21: Thales - Key Products 74
  • Table 22: Thales - Alliances 76
  • Table 23: Thales - Recent Contract Wins 77
  • Table 24: Iveco - Key Products 81
  • Table 25: Iveco - Alliances 82
  • Table 26: Iveco - Recent Contract Wins 82
  • Table 27: Navantia - Key Products 83
  • Table 28: Navantia - Alliances 86
  • Table 29: Navantia - Recent Contract Wins 87
  • Table 30: General Dynamics European Land Systems (GDELS) - Key Products 89
  • Table 31: General Dynamics European Land Systems (GDELS) - Alliances 90
  • Table 32: General Dynamics European Land Systems (GDELS) - Recent Contract Wins 91
  • Table 33: Aernnova Aerospace S.A. - Key Products 93
  • Table 34: Aernnova Aerospace S.A - Alliances 94
  • Table 35: Aernnova Aerospace S.A. - Recent Contract Wins 95
  • Table 36: Aries Ingenieria Y Sistemas, S.A - Key Products 96
  • Table 37: Aries Ingenieria Y Sistemas - Alliances 97
  • Table 38: Indra Sistemas SA - Key Products 98
  • Table 39: Indra Sistemas S.A. - Alliances 100
  • Table 40: Indra Sistemas S.A. - Recent Contract Wins 101
  • Table 41: Sociedad Anonima De Electronica Submarina, S.A. - Key Products 105
  • Table 42: Sociedad Anonima De Electronica Submarina, S.A. - Alliances 106
  • Table 43: Sociedad Anonima De Electronica Submarina, S.A. - Recent Contract Wins 107
  • Table 44: Tecnobit - Key Products 108
  • Table 45: Tecnobit - Alliances 110
  • Table 46: Tecnobit - Recent Contract Wins 111
  • Table 47: Uro Vehiculos Especiales S.A. - Key Products 112
  • Table 48: Uro Vehiculos Especiales S.A. - Recent Contract Wins 113
  • Table 49: Amper S.A. - Key Products 114
  • Table 50: Amper S.A.: - Alliances 115
  • Table 51: Amper S.A.: - Recent Contract Wins 116

List of Figures

  • Figure 1: Spanish Defense Expenditure (EUR Billion), 2014-2023 28
  • Figure 2: Spanish Defense Expenditure (US$ Billion), 2014-2023 28
  • Figure 3: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023 32
  • Figure 4: Spanish - Defense Capital Expenditure (EUR Million), 2014-2023 34
  • Figure 5: Spanish - Defense Capital Expenditure (US$ Million), 2014-2023 34
  • Figure 6: Spanish GDP Growth vs. Defense Expenditure as a Percentage of GDP, 2014-2023 36
  • Figure 7: Spanish Per Capita Defense Expenditure (US$), 2014-2023 37
  • Figure 8: Spanish Homeland Security Budget (EUR Billion), 2014-2023 39
  • Figure 9: Spanish Homeland Security Budget (US$ Billion), 2014-2023 39
  • Figure 10: SDI Terrorism Heat Map, 2018 41
  • Figure 11: Terrorism Index, 2018 44
  • Figure 12: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023 46
  • Figure 13: Defense Expenditure of the World's Largest Military Spenders (US$ Billion), 2018 & 2023 47
  • Figure 14: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2018 48
  • Figure 15: Land-based C4ISR (US$ Million), 2018-2023 50
  • Figure 16: Physical Security (US$ Million), 2018-2023 51
  • Figure 17: Multirole Aircraft (US$ Million), 2018-2023 52
  • Figure 18: Spain - Defense Procurements in Terms of Supplier Relationships, 2018 54
  • Figure 19: Spanish Defense Import Trend (US$ Million), 2013-2017 (TIV values) 55
  • Figure 20: Spanish Defense Imports by Country (%), 2013-2017 56
  • Figure 21: Spanish Defense Imports by Category (%), 2013-2017 57
  • Figure 22: Spanish Defense Exports (US$ Million), 2013-2017 (TIV values) 58
  • Figure 23: Spanish Defense Exports by Country (%), 2013-2017 59
  • Figure 24: Spanish Defense Exports by Category (%), 2013-2017 60
  • Figure 25: Industry Dynamics - Porter's Five Forces Analysis 61
  • Figure 26: Thales - Revenue Trend Analysis (EUR Billion), 2013-2017 79
  • Figure 27: Thales - Operating Profit Trend Analysis (EUR Million), 2013-2017 79
  • Figure 28: Thales - Net Profit Trend Analysis (EUR Million), 2013-2017 80
  • Figure 29: Indra Sistemas S.A. - Revenue Trend Analysis (EUR Billion), 2013-2017 103
  • Figure 30: Indra Sistemas S.A. - Operating Profit Trend Analysis (EUR Million), 2013-2017 103
  • Figure 31: Indra Sistemas S.A. - Net Profit Trend Analysis (EUR Million), 2013-2017 104
  • Figure 32: Amper S.A. - Revenue Trend Analysis (EUR Billion), 2013-2017 117
  • Figure 33: Amper S.A. - Operating Profit Trend Analysis (EUR Million), 2013-2017 117
  • Figure 34: Amper S.A. - Net Profit Trend Analysis (EUR Million), 2013-2017 118
  • Figure 35: Spanish GDP Per Capita at Constant Prices (US$), 2015-2025 119
  • Figure 36: Spain GDP at Current Prices (US$ Billion), 2015-2025 120
  • Figure 37: Spanish Exports of Goods and Services (LCU Billion), 2005-2014 121
  • Figure 38: Spanish Imports of Goods and Services (LCU Billion), 2005-2014 122
  • Figure 39: Spanish Gross National Disposable Income (US$ Billion), 2005-2013 123
  • Figure 40: Spain LCU per US$, 2015-2024 124
  • Figure 41: Spanish Market Capitalization of Listed Companies (US$ Billion), 2005-2012 125
  • Figure 42: Spanish Market Capitalization of Listed Companies (% of GDP), 2005-2012 126
  • Figure 43: Spanish Government Cash Surplus/Deficit as a Percentage of GDP (LCU), 2005-2012 127
  • Figure 44: Spain- Goods Exports as a Percentage of GDP (%), 2005-2014 128
  • Figure 45: Spain- Goods Imports as a Percentage of GDP (%), 2005-2014 129
  • Figure 46: Spanish Services Imports as a Percentage of GDP (%), 2005-2014 130
  • Figure 47: Spanish Service Exports as a Percentage of GDP (%), 2005-2014 131
  • Figure 48: Spain - Foreign Direct Investment, net (BoP, current US$ Billion), 2005-2014 132
  • Figure 49: Spanish Net Foreign Direct Investment (as a Percentage of GDP) 2005-2014 133
  • Figure 50: Spanish Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014 134
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