The
Global Military Ammunition Market 2013 – 2023
This report is the result
of SDI's extensive market and company research covering the global military
ammunition industry. It provides detailed analysis of both historic and
forecast global industry values, factors influencing demand, the challenges
faced by industry participants, analysis of the leading companies in the
industry, and key news.
To
check out the complete table of contents, visit: http://www.marketresearchreports.biz/analysis-details/the-global-military-ammunition-market-2013-2023
Introduction
and Landscape
Why
was the report written?
“The Global Military
AmmunitionMarket 2013-2023” offers the reader detailed analysis of the global
military ammunitionmarket over the next ten years, alongside potential market
opportunities to enter the industry, using detailed market size forecasts.
What
are the key drivers behind recent market changes?
Numerous countries in the
world are currently involved in conflicts with their neighboring nations owing
to reasons such as territorial disputes and terrorism. This situation is most
commonly evident in the Asia Pacific region due to the rapid economic and
military development among countries such as China, India, Japan, South Korea
and North Korea among others. All the above mentioned countries are making
rapid efforts in order to strengthen their military forces in order to be
battle ready and thus involved in an arms race. And, battle readiness demands
possessing adequate ammunition of various kinds including small caliber,
artillery, mortar, large caliber and medium caliber. For example, India and
Pakistan share tense relations owing to the territorial disputes between each
other, as well as cross-border terrorism. The countries' militaries are
involved in frequent cross-border firing despite their ceasefire agreement signed
a decade ago. China and South Korea too share hostile relations owing to the
Chinese government's intentions to reunite both the countries which are
strongly opposed by the latter nation. Thus, South Korea is also making
significant efforts in order to defend the Chinese military power when needed,
though with the support of its allies such as the US.
What
makes this report unique and essential to read?
“The Global Military
Ammunition Market 2013-2023” provides detailed analysis of the current industry
size and growth expectations from 2013 to 2023, including highlights of key
growth stimulators. It also benchmarks the industry against key global markets
and provides detailed understanding of emerging opportunities in specific
areas.
Key
Features and Benefits
- The report provides
detailed analysis of the market for military ammunitionduring 2013-2023,
including the factors that influence why countries are investing or
cutting expenditure on military ammunition. It provides detailed
expectations of growth rates and projected total expenditure.
- The global ammunition
industry is expected to witness a steady rise in the number of joint
ventures and strategic alliances during the forecast period, due to the
insufficient indigenous manufacturing capabilities of numerous countries
such as the US, India, and Brazil. These countries are dependent on
foreign ammunition manufacturers in order to meet demand and develop
indigenous ammunition manufacturing capabilities. Some recent notable
joint ventures are mentioned below:
- By the end of 2013,
Russia and India are expected to establish a joint venture to manufacture
ammunition for the Smerch multiple launch rocket system in India. The
Russian firms Rosoboronexport and OAO NPO Splav are expected to form a
joint venture with the artillery production department of the Indian
defense ministry in order to produce, as well as provide after sales
support to, the specified ammunition in India.
- In April 2012, General
Dynamics Ordnance and Tactical Systems and Rheinmetall Defense announced
the formation ofa joint venture called Defense Munitions International,
LLC in order to develop and market the new and existing kinetic energy and
multi-purpose cartridges,which are elements of tank ammunition. The JV
intends to market these products in the US as well as international
markets.
- In January 2012, BAE Systems
and Olin Winchester announced that they have formed a joint venture called
US Munitions, LLC in the US. The joint venture was formed with an aim to
undertake the contract awarded by the US DoD to manage, operate and
maintain its Lake City Army Ammunition Plant till 2022. The contract is
worth US$8.4 billion.
Key
Market Issues
- Reducing the weight of
ammunition without compromising combat performance is a key challenge for
the military ammunition industry. The modernization of soldier systems to
protect and empower the soldier has resulted in an exponential increase in
the total weight being carried. The combined weight of equipment prevents
them from being agile, mobile, and effective war fighters, and the lives
of soldiers are being put at risk as heavy life saving equipment is often
being left behind. Defense agencies worldwide are focusing on sourcing and
integrating the most affordable, lightweight soldier equipment and
technology to reduce the burden to personnel. For example, the US
Department of Defense Ordnance Technology Consortium awarded a US$2.05
million contract to AAI's Lightweight Small Arms Technologies (LSAT) team,
part of Textron Systems to innovate both its caseless and cased telescoped
lightweight ammunition and weapon technologies. The contract includes
refining the 5.56mm Cased Telescoped ammunition and Light Machine Gun in
support of an Army live fire experiment; development, testing and
characterization of prototype 5.56mm Caseless ammunition; and extending
Cased Telescoped ammunition technologies to a 7.62mm cartridge. The US
Army Armament Research, Development and Engineering Center (ARDEC) and the
Department of the Navy's Office of Naval Research are jointly
participating in this program. The contract is for a one year period and
the team of AAI consists of Alliant Techsystems (ATK), Veritay Technology,
and St. Marks Powder, a General Dynamics company. The UK MoD also plans to
reduce the load on soldiers from 70 kg to no more than 25 kg under the
Reducing the Burden on the Dismounted Soldier (RBDS) program. Furthermore,
defense ministries are funding research and development projects that
focus on reducing the weight of equipment, power, and communication
systems that soldiers carry. All capability areas such as lethality - soldier's
weapons and ammunition; survivability and mobility - body armor, clothing,
helmet, and equipment; C4ISR - radios, wearable computers, and optics,
have to be integrated to reduce the weight.
- Recent years have
witnessed an increase in shortage of skilled laborers globally, mainly due
to growing orders from the defense ministries for ammunition. There is a
scarcity of technically skilled workers in firearms industry and the
companies catering to ammunition needs of the militaries are ready to
recruit more workers if they get in order to reduce their order backlogs.
Skilled laborers were already scarce in the past in the arms and
ammunition industry and the big ammunition programs announced by some
countries recently have further caused the supply shortage to grow. The
procurement of small caliber ammunition worth US$8.5 billion by the US DoD
and US$3.2 billion Munition Acquisition Supply Solutions (Mass) program of
the UK MoD are examples of such huge ammunition programs being carried
out. Manufacturers that are supplying ammunition to the defense ministry
started working with educational institutions to create programs to
provide technicians for the industry as many of the positions are vacant
in these companies due to lack of right workers. Implementation of
measures to fill the existing shortage of skilled work force to clear
order backlogs and get workers for positions that are newly created due to
programs recently announced are expected to take much time and as such
during the forecast period, lack of skilled laborers is expected to remain
as a key challenge for the military ammunition industry.
- The US government
announced the withdrawal of majority of its troops from Afghanistan in
2011 and it started gradual withdrawal in the same year. By February 2014,
34,000 troops are expected to remain in Afghanistan with the withdrawal of
34,000 troops. The decision is expected to affect the military ammunition
market especially the small caliber ammunition market as these are the
types of ammunition mostly used for the combat mission in Afghanistan. The
US has plans to leave between 6,000-20,000 troops until 2024 for support
mission. The UK government also has plans to reduce its troop size in
Afghanistan to 5,200 by the end of 2013 and to withdraw remaining soldiers
by the end of 2014. Another major contributor for the Afghanistan combat
mission, Germany has pulled out all of its troops in 2013. This, as
support mission that includes counterterrorism mission and logistical and
training support for Afghan forces will not require much of ammunition;
the draw down plan is anticipated to negatively impact the market growth.
Along with this, army personnel cuts announced by countries such as the US
and the UK are also expected to cause a moderate growth of the military ammunition
market. The US plans to cut its army personnel numbers from 535,000 to
380,000 by 2019 and the UK MoD plans reducing the number of army personnel
from 102,000 to 82,000 by 2017.
Key
Highlights
- The US DoD is making
significant efforts to reduce the weight carried by the soldiers in the
battlefield. One such initiative is the Lightweight Small Arms
Technologies (LSAT) development program, through which the US DoD aims to
provide lightweight weapons and ammunition to its forces. The infantry
soldiers carry a range of equipment including arms and ammunition in the
battlefield, which are very heavy to carry for long durations and thus
affect the soldiers' fighting capabilities. Therefore, this program
intends to equip the soldiers with light-weight machine guns which fire
specially designed ammunition, which is also significantly lighter in
weight that the conventional small caliber ammunition.The new advanced
light machine gun is designed to utilize 5.56mm ammo designed by the AAI
Corporation, which is a part of Textron Systems in cooperation with the US
DoD. This new ammunition is called telescoped ammunition and does not
consist of the conventional brass cartridge, due to which the weight of
the ammunition is significantly decreased by approximately 40% compared to
the traditional 5.56 ammunition. The new ammunition uses solid propellant
that does not need casing and is directly fed into the weapon. These
bullets are also shorter and use lesser volumes, which enable the soldiers
to carry more ammunition and less weight. Recently, the US DoD also
awarded a contract to improve the lightweight 5.56 ammunition and apply
the same technology in the 7.62mm ammunition as well. It is expected that
these technological advancements will reduce approximately 25 pounds (lbs)
from a typical M249 Squad Automatic Weapon gunner. Therefore, these
lightweight ammunitions are expected to be adopted by various militaries
during the forecast period.
- Warfare techniques
have undergone significant changes during the past decade owing to the
rise in guerilla warfare, counter-insurgency and counter-terrorism
operations in various countries. Therefore, with an increase in the
instances of asymmetric warfare by terrorists, insurgents and rebel
forces, the military forces are finding newer ways to neutralize the enemy
with newer ammunition. Precision munitions are one such weapon of choice
for the militaries fighting in environments such as Iraq and Afghanistan,
which need greater accuracy in attacks. The various types of precision
munitions include Excalibur, XM395 precision mortar and Guided Multiple
Launched Rocket System (GMLRS) ammunition among others. The factors that
are expected to bolster the spending on precision munitions are
significantly decreasing costs, wide range of options to choose from and
the rising familiarity with these weapons among the militaries of numerous
countries. The ammunition manufacturers such as Alliant Techsystems (ATK)
have developed course correcting fuses, which can convert conventional
rounds into guided bombs. These are relatively cheaper than the advanced
precision munitions such as Raytheon's Excalibur Block 1b. Furthermore,
the unit costs of these munitions have also decreased significantly during
the last three to four years. For example, Raytheon's Excalibur 1a
projectile unit had cost around US$87,000 in 2010, whereas the cost of the
Excalibur 1b projectile in 2012 was US$45,000. This steep reduction in
prices can be attributed to the economies of scale due to the rapidly
increasing orders for these weapons.
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