Armored vehicles are designed to provide protection from bullets, explosives, and other hostile threats through the use of armor. They play a vital role in military land operations by transporting troops and providing fire support. Armored vehicles allow military operations to be carried out securely and effectively even in hostile territories. With increasing geo-political tensions, upsurge in cross border conflicts and rising threats of asymmetric warfare, countries across the world are focusing on modernizing their defense capabilities. This has significantly driven the demand for advanced armored vehicles with improved firepower, mobility, and protection over the recent years.
The Global Armored Vehicle Market is estimated to be valued at US$ 42.21 Bn in 2024 and is expected to exhibit a CAGR of 5.8% over the forecast period from 2024 to 2031.
Key Takeaways
Key players operating in the armored vehicle market are BAE Systems, BMW AG, Daimler AG (Mercedes Benz), Ford Motor Company, General Dynamics Corporation, INKAS Armored Vehicle Manufacturing, International Armored Group, Lenco Industries, Inc., Lockheed Martin Corporation, Navistar, Inc., Oshkosh Defense, LLC, Rheinmetall AG, STAT, Inc., Textron, Inc., and Thales Group. The increasing conflicts worldwide have amplified the demand for these armored vehicles from military as well as law enforcement agencies. Furthermore, ongoing technological advancements such as active protection systems, advanced armor materials, networked C4ISR solutions and electric drivetrains are strengthening the protection, mobility, and sustainability of these vehicles.
The rising global security concerns and asymmetric warfare tactics have intensified the need for a well-equipped land force. Armored Vehicle Market Size This has significantly driven the demand for modern armored vehicles with improved firepower, mobility, and protection capabilities. Additionally, growing investments in military modernization programs by developing economies are also propelling the demand. Furthermore, ongoing R&D towards development of lightweight armored vehicles with advanced protection systems is augmenting the market growth.
Technological advancements are also playing a key role in revolutionizing armored vehicle design and capabilities. Ongoing developments in active protection systems, advanced armor materials, electric drivetrains, networked C4ISR solutions and advanced weapons systems are enhancing the lethality, mobility and situational awareness of these vehicles. This is strengthening their effectiveness in complex terrains and hostile combat zones. Moreover, growing integration of wireless technologies, artificial intelligence, Internet of Battlefield Things (IoBT) and advanced optics are transforming armored vehicles into lethal and networked platforms.
Market Trends
Increased Procurement of Light Protected Mobility Vehicles - With growing emphasis on mobility, agility and outreach, there is an increased demand for light protected mobility vehicles amongst militaries worldwide. Key factors like lower acquisition and life-cycle costs, higher payload carrying capability and transportability via aircraft are driving the procurement of light MRAPs and light tactical vehicles.
Rising Adoption of Electric & Hybrid Drivetrains - With an aim to reduce operational costs and fuel dependency, militaries are showing increased interest in electric and hybrid drivetrains for light and medium-duty armored vehicles. Ongoing technology advancements are making electric drivetrains a feasible option for military applications without compromising on the vehicle performance.
Market Opportunities
Development of Autonomous Capabilities - Ongoing R&D towards development of autonomous driving, navigation and turret systems provide opportunities for enhanced situational awareness, reduced crew fatigue and added protection for soldiers. However, development and integration of applicable regulations remains a challenge.
Integration of Advanced Protection Systems - Incorporation of latest active protection systems like arena, trophy and iron fist with capabilities like hard-kill, soft-kill and countermeasure dispensing offer significant growth opportunities. However, high costs remain a major restraint.
Impact of COVID-19 on Armored Vehicle Market growth
The COVID-19 pandemic has impacted the growth of the armored vehicle market. During the initial lockdown phases imposed by various governments, production facilities were shut down temporarily to curb the spread of the virus. This led to disruptions in the global supply chain and a decline in production volumes across major manufacturers. Procurement of new vehicles was also restricted as military budgets were diverted to pandemic response measures. However, with gradual lifting of restrictions, production has resumed while following necessary safety protocols.
Despite near-term slowdown, the long-term outlook for the armored vehicle market remains positive. The pandemic has highlighted the importance of national security preparedness. It has also triggered geopolitical tensions in some regions, increasing the focus on military upgrades. Leading manufacturers are striving to recover lost sales through new product launches and modernization programs. The demand for multi-purpose vehicles for homeland security, border patrolling and law enforcement is likely to increase in the post-COVID scenario. Ongoing vaccine rollouts and economic recovery programs are expected to boost procurement activities in the coming years.
Regions where Armored Vehicle Market value is concentrated
The armored vehicle market in terms of value is highly concentrated in North America and Europe. Countries like the US, Canada, Germany, UK and France have large defense budgets and established domestic production capabilities. The US spends around $600-700 billion annually on national security and maintains one of the strongest armored vehicle fleets in the world consisting of combat vehicles, armored personnel carriers, military trucks and Mine-Resistant Ambush Protected (MRAP) vehicles. In Europe as well, countries are continuously upgrading their fleets through collaborative programs. The ongoing modernization drive is boosting revenues for key manufacturers based in these regions.
Fastest growing region for Armored Vehicle Market
The Asia Pacific region is expected to witness the fastest growth in the armored vehicle market over the forecast period. Countries like India, China, Japan and South Korea are increasing their defense capitalization at a rapid pace. They are actively pursuing indigenization and expanding their fleet of wheeled and tracked armored platforms. India has implemented large Make in India programs for armored fighting vehicles and mine protected carriers. China is also stepping up domestic R&D and exporting armored vehicles to other Asian and African countries. This growing procurement demand from Asia coupled with greater localization will drive higher sales growth compared to other regions.
Regional threat perceptions, evolving military doctrines and expanding Indo-Pacific collaborations are favoring increased indigenous production and imports of sophisticated armored systems across Asia in the coming years.
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