PARIS, 17 June 2009.Unmanned aerial vehicles (UAVs) represent a prime area of acquisition interest for major aerospace contractors, Teal analysts report in their latest integrated market analysis.
"UAVs are one of the most active areas for acquisitions by defense companies," says Philip Finnegan, Teal Group's director of corporate analysis. "The sector has the advantage of being a high growth area and having a number of small producers available for purchase." As a result, UAVs rank with intelligence, cyber security, homeland security, and logistics as one of the most attractive for acquisitions, he continues.
Teal Group's "Defense & Aerospace Companies Briefing," just released, is a competitive intelligence service that evaluates roughly 50 key world aerospace and defense companies.
Northrop Grumman announced in April that it purchased the Killer Bee UAV line from Swift Engineering. The move strengthens Northrop Grumman's position in Tier II UAVs. Northrop Grumman has an extremely strong position in larger UAVs, such as the Global Hawk and the Fire Scout, says Finnegan.
BAE Systems announced the previous month that it would buy Advanced Ceramics Research, a U.S.-based manufacturer of three small UAVs. The purchase gives UK-based BAE Systems a foothold in the U.S. UAV market, continues Finnegan.
Boeing purchased Institu, manufacturer of the Scan Eagle UAV in July 2008. Boeing and Institu were also cooperating in marketing the Scan Eagle.
Textron purchased AAI Corp., manufacturer of the Shadow UAV, in 2007. That acquisition revitalized Textron's position following the Coast Guard decision not to fund further development of its Eagle Eye UAV.
Until recently smaller companies have been extremely competitive in UAVs, enabling them to build up position as prime contractors that they would be unable to attain in other more established sectors of the industry, says Finnegan. Teal Group's market study includes a UAV Manufacturers Market Overview that examines the unique characteristics of the UAV market that enabled this growth and ways the market is shifting toward larger companies.
Teal Group's 2009 market study estimates that UAV expenditures will double within a decade from $4.4 billion annually to $8.7 billion, with more than $62 billion spent over the next 10 years. The study indicates that the U.S. will account for 72 percent of the worldwide RDT&E spending on UAV technology over the next decade, and about 61 percent of the procurement.
The sixth edition of the sector study, "World Unmanned Aerial Vehicle Systems, Market Profile and Forecast 2009", examines the worldwide requirements for UAVs, including UAV payloads, and provides 10-year forecasts by country, region, and class of UAVs.
The 2009 study also provides 10-year funding and production forecasts for a wide range of UAV payloads, including Electro-Optic/Infrared Sensors, Synthetic Aperture Radars (SARs), SIGINT and EW Systems, C4I Systems, and CBRN Sensors. It forecasts that these sensors will grow from $2 billion in 2009 to nearly $5 billion in 2018. The UAV electronics market will grow steadily, with especially fast growth and opportunities in SAR and SIGINT/EW.
