Land-based Military Electro-optical and Infrared Systems Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Land-based Military Electro-optical and Infrared Systems Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Land-based Military Electro-optical and Infrared Systems Market was valued at USD 1.56 billion in 2021, and it is projected to grow with a CAGR of 2.08% during the forecast period (2022-2031).

The outbreak of COVID-19 and the subsequent shutdowns have affected the defense manufacturing sector in several countries. The pandemic has affected the global defense supply chains, as several defense manufacturers enforced production cuts in 2020. Though several nations have continued to maintain colossal budgets even in 2020, maintaining the same levels of defense spending during the forecast period in the aftermath of the pandemic requires sustained political will from the governments.

Advanced optronic systems have become essential to enhance land vehicles’ combat effectiveness. Thermal sights, panoramic vision, and enhanced driver vision capabilities are some of the elements available for new and upgraded fighting vehicles. The amalgamation of these systems with advanced processing techniques enables the operators to obtain wide-angle coverage for situational awareness and target acquisition, thereby, helping them in better decision making on the battlefield.

In the current battlefield scenario, soldiers and land vehicles are required to function in the day, night, and under adverse weather and limited visibility conditions, where human vision is not enough. In this regard, militaries have been equipping their man-portable systems and armored vehicles with Electro-optical vision systems, thereby, preparing them to fight in the modern battlefield scenarios. This is expected to bolster the market prospects during the forecast period.

Key Market TrendsVehicle Mounted Segment is Expected to Grow with the Highest CAGR During the Forecast Period

Advanced optronic systems are becoming essential to enhance armored vehicles’ combat effectiveness. Thermal imaging, 360-degree vision, and enhanced night vision capabilities are some of the technologies that are being focused upon, for land vehicles and dismounted infantrymen. With the focus growing on enhancing vehicle protection systems, players are working on sensors that provide expanded visibility, situational awareness, and threat warning to military armored vehicles and crews. The ongoing modernization efforts for land vehicles are also expected to generate demand for newer generation vehicle-based EO/IR sensors. RWS for land vehicles has grown more effective with the incorporation of features, like fire-on-the-move capabilities, day and night imaging, automatic target tracking, laser range finder for accurate ballistics, last round warning, manual backup, and high ammunition storage capabilities, among others. Due to this, many countries are upgrading their weapon systems to newer versions to take advantage of the latest technologies. Also, the focus on ground-based on-the move-surveillance is expected to generate significant demand for land-based EO/IR systems. In January 2021, FLIR Systems, Inc. announced that it has received awards from the United States to deliver improved air and ground surveillance capabilities using advanced thermal imaging and drone technology. The combined awards are potentially worth more than USD 23 million and include the delivery of the next-generation FLIR LVSS (Lightweight Vehicle Surveillance System) for the Mobile Surveillance Capability (MSC) program, among others. Such developments are expected to drive the growth of the segment during the forecast period.

North America Held the Largest Market Share in 2021

North America held the largest market share across all the regions in 2021, driven by high demand from the United States. The enhanced capabilities of China and Russia on the battlefield forced the United States to increase its investments into technologically advanced military vehicles and weapon systems. Some of the large acquisitions planned by the US army over the next two years include a collection of night vision devices, including night-vision goggles, laser target locator modules, monocular night vision devices, the Integrated Visual Augmentation System (IVAS) heads-up display, and multi-function laser illuminators. On that note, in October 2020, L3Harris Technologies and Elbit Systems’ US subsidiary were awarded a potential USD 442 million other transaction authority contract to manufacture binocular night vision devices for the US Army. Elbit Systems also announced that it has received an initial USD 22.5 million order under the OTA to begin low-rate initial production of the goggles. The two companies’ ENVG-B offerings will go through qualification procedures, such as system and field tests, before getting selected for a major contract. Also, the Integrated Visual Augmentation System (IVAS), an augmented reality goggle based on Microsoft’s HoloLens, underwent extreme cold-weather testing at the US Army Cold Regions Test Center. The IVAS prototype heads up display includes a variety of sophisticated capabilities including night vision and thermal scope settings. Also the focus of the country on obtaining advanced ISR capabilities is proving to be fruitful for several EO/IR technology providers. The procurement of unmanned ground vehicles for ISR purposes is expected to increase in the country, years to come, which will propel the demand for land-based military EO/IR systems from the North America during the forecast period.

Competitive Landscape

Some of the prominent players in the market are Teledyne FLIR LLC, L3Harris Technologies Inc., BAE Systems plc, Thales Group, and Leonardo DRS. Players in the market are trying to modify and enhance their current capabilities through continuous R&D and introduce sophisticated features to deliver value-added EO/IR solutions to end-users. Most of the integration programs are long-term, and hence, several IDIQ contracts are currently underway, signifying design modification and production of sophisticated EO/IR sensors as per end-user specifications. Gaining such contracts will help the players in terms of continuous cash-inflow, thereby helping their sustained growth. Furthermore, the development of a new integration platform drives the demand for the integration of sophisticated EO/IR sensors and systems, which in turn, may create a positive outlook for the market during the forecast period.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned
 
BAE Systems plc
Elbit Systems Ltd
Teledyne FLIR LLC
Israel Aerospace Industries Ltd.
Rheinmetall AG
Saab AB
Thales Group
HENSOLDT AG
L3Harris Technologies Inc.
Leonardo S.p.A.
Tonbo Imaging

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