Guided Munitions Market: Global Industry Analysis and Forecast (2024-2030)

Guided Munitions Market Overview

Guided munitions, also known as precision-guided munitions (PGMs), are weapons equipped with guidance systems that allow them to precisely target specific locations. These systems significantly enhance accuracy compared to unguided munitions, which rely on ballistic trajectories and are more susceptible to various forms of deviation.

The Guided Munitions Market report provides a comprehensive analysis of the strategies employed by top companies and a detailed examination of market segments and regional trends. It offers critical insights into pricing, costs, revenues, and profit margins, making it an invaluable resource for investors in this sector. By analyzing market dynamics, the report assesses the drivers of growth, potential constraints, opportunities, and challenges across different regions and segments.

The report employed a bottom-up methodology to determine market sizes at both global and regional levels. Additionally, a SWOT analysis was performed to identify the strengths and weaknesses of key players in the Guided Munitions sector. To ensure the accuracy of its findings, the report combined both primary and secondary research methods. Primary research included distributing surveys, administering questionnaires, and conducting phone interviews with industry experts, leaders, marketers, and entrepreneurs in the Guided Munitions market. Guided munitions represent a significant advancement in modern warfare, enabling forces to conduct operations with unprecedented precision and efficiency.

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Guided Munitions Market Dynamics

Surge in Guided Munitions Demand Spurs Global Market Development

Growth in the Guided Munitions Market has been fueled by the surge in guided munitions, which allow targets to be hit with high accuracy using pre-programmed coordinates. The need for GPS in munitions has grown since the device measures its position and compares it to the coordinates of the target. The market growth has been driven by significant investments made by major regions to acquire precision-guided weapons and smart munitions, which has resulted in an increase in demand for related ammunition in recent years.  Several countries increasing their defense budgets in response to perceived threats and in an attempt to modernize their armed forces, the market for guided weapons has extended. For instance, the U. S. Department of Defense has consistently provided sizable funding for the development and procurement of state-of-the-art guided weapons.

Navigating Challenges: Legal, Ethical, and Competitive Hurdles in the Guided Munitions Market

Managing the intricate network of global arms trade laws, including the U.S. International Traffic in Arms Regulations (ITAR), and maintaining adherence to these rules is a major difficulty. There are moral and legal concerns about civilian casualties and compliance with international humanitarian law when using guided munitions, especially in conflict areas has restrained the Guided Munitions Market growth. Emerging companies and other established players pose fierce competition to even the market leaders. Preserving a competitive advantage concerning technology, cost, and excellence is essential.

It's always difficult to strike a balance between the demand for cutting-edge technology and affordable manufacturing techniques as a result it has slowed the growth of the market. Overspending on a project has resulted in delays and lower profitability. Contracts and policies of the government have been impacted by public opinion and media scrutiny. Reduced political support for guided munitions' development and application resulted from unfavorable opinions of military operations involving them.

Innovations Driving the Future of Guided Munitions Market

Military operations have been revolutionized by recent innovations that have increased their capabilities. Swarming technology and miniaturization allow smaller, more maneuverable munitions to precisely coordinate attacks, which puts enemy defenses to the test. Because of their increasing autonomy, these weapons have been adjusted in flight, saving operators time and improving their adaptability. Artificial intelligence-powered advanced target recognition technology helps with precise target engagement while reducing civilian casualties. While improved GPS and inertial navigation systems ensure pinpoint accuracy, integration into network-centric warfare improves coordination and effectiveness. By improving national security and lowering the material and human costs of warfare, these advancements represent a turning point in the development of the guided munitions market.

Guided Munitions Market Segment Analysis

Based on Product, the Tactical Missiles segment held the largest Guided Munitions Market share and is expected to dominate the market with an increasing CAGR through the forecast period. The growing popularity of tactical missiles has risen owing to their widespread application in combat and it is designed for immediate use in combat zones, tactical guided missiles are weapons with a shorter range. Progress in materials science, propulsion systems, and guidance systems has enabled increased missile efficiency, accuracy, and versatility.

The continuous and escalating regional conflicts and geopolitical tensions have significantly increased the need for tactical missiles. Nations try to bolster their military power to repel enemies and respond swiftly in the event of a threat. For example, in the Middle East, the hostilities between Iran and its neighbors, as well as the wars in Syria and Yemen, have led to an increase in missile production.  Tactical missiles have more accuracy thanks to their advanced guidance systems. Examples of precision developments driving demand are the Javelin anti-tank missile and the HIMARS (High Mobility Artillery Rocket System). Many countries are pursuing defense modernization programs aimed at swapping out outdated armaments for state-of-the-art tactical missile systems has boosted the Guided Munitions Market growth.       

Guided Munitions Market Regional Analysis

North America Guided Munitions Market held the largest regional share and is expected to maintain its dominance with an increasing CAGR through the forecast period. North America is at the forefront of innovating defense technology, with companies like Northrop Grumman, Lockheed Martin, and Raytheon leading the development of next-generation guided munitions. In 2023, Raytheon Technologies was contracted to manufacture and supply advanced guided missile systems for a whopping USD 985 million. The United States, known for having one of the world's largest defense budgets, allocated a significant portion of its USD 886 billion defense budget in 2023 for sophisticated weapons like guided munitions.

• The two largest spenders the United States (37%) and China (12%) made up around half of global military spending, increasing their expenditure by 2.3% and 6% respectively.
• In 2023, the U.S. Department of Defense awarded several contracts for the procurement of guided munitions. For example, Lockheed Martin received a contract worth USD 8.6 billion to supply precision-guided munitions.

The main objective of the U.S. Department of Defense's focus on the Joint All-Domain Command and Control (JADC2) system is to bring together different branches of the military to improve the efficiency and effectiveness of guided munitions.

Guided Munitions Market Competitive Landscape

• In May 2024, Boeing wins a USD 7.5 billion contract from the US Air Force for guided bombs. The company is expected to provide JDAM tail kits and other supplies under the sole-source fixed-price, indefinite-delivery/indefinite-quantity contract, the Pentagon. The company is expected to work on the kits, as well as spares, repairs, technical assistance, and laser JDAM sensor kits, at its St Louis, Missouri, facility through the end of February 2030.
• In October 2023, The U.S. Navy awarded Northrop Grumman Corporation (NYSE: NOC) a development contract for the company’s newly designed 57mm guided high explosive ammunition. Designated for use with the Mk110 Naval Gun Mount, the company will test and mature the munition for qualification.
• In March 2023, BAE Systems Australia and MBDA announced a collaboration to help Australia increase its guided weapons and explosive ordnance (GWEO) capabilities. The partnership is expected to leverage MBDA’s missile production and BAE’s local experience and expertise. The companies have delivered a range of GWEO capabilities to Australia, including BAE’s Evolved Sea Sparrow Missile and Nulka subsystems and MBDA’s ASRAAM air-to-air missile program.

Key Players Guided Munitions Market

1. Lockheed Martin                       
2. Boeing
3. Northrop Grumman
4. BAE Systems
5. General Dynamics
6. Thales Group
7. MBDA
8. Israel Aerospace Industries (IAI)
9. Rheinmetall AG
10. Leonardo S.p.A.
11. LIG Nex1
12. Rafael Advanced Defense Systems
13. Elbit Systems
14. MKEK (Mechanical and Chemical Industry Corporation)
15. Hanwha Defense
16. Textron Systems
17. Harris Corporation (L3Harris)
18. General Atomics
19. Kaman Corporation
20. AeroVironment