The fire control system market is anticipated to grow at a CAGR of more than 4% during the forecast period.
- An increase in the demand for automated fire control systems and the ongoing development of consolidated fire control systems are the major factors driving the market.
- Technological limitations, such as deterrents, and the increasing use of active protection systems pose a challenge to system designers.
- The emergence of directed energy weapons (DEW) possess immense potential for military applications and could dramatically reduce the cost associated with the development and operating of both offensive and defensive weaponry. Widespread adoption of DEWs can trigger a radical change in market dynamics.
Key Market Trends
Ongoing Digitization of Battlefield Driving the Introduction of Sophisticated Fire Control Systems
Battlefield digitization means a system, wherein the components are integrated into the force, evaluated, acquired, and updated together, to the maximum extent possible. The introduction of information-based weapon systems capable of providing combat vehicle crews with effective firepower and knowledge base to coordinate and employ both onboard and external sensors and weapons will change the current tactics, techniques, and procedures of the armed forces. Network-centric warfare was devised by the US military during the 1990s and requires the thorough integration of sensors, communication networks, command centers, and associated platforms to achieve complete situational awareness and perfect synchronization between sensors and responders in a fast-paced mobile environment. Electro-optic systems on land are observed to be effective in tracking armored vehicles and low-observable missiles. This helps platoons to strategize their approach. Technology upgrade has resulted in increased situational awareness for modern fire control systems. Modern versions of prominent weapons such as the Stinger missile feature sophisticated IR and UV technology that enhances the targeting efficiency of the Stinger by making it less prone to countermeasures such as flares when targeting is based on the heat signature of the engine. Besides, the addition of a proximity fuse on the missile warhead enhances its capability to secure a more reliable lock on targets such as UAVs.
North America to Dominate the Market During the Forecast Period
The US has been the pioneer of armed warfare and has positioned itself at the apex of military dominance through a steady growth in the procurement of advanced weapon systems. The changing nature of warfare is one of the prime reasons for the US DoD's increased spending towards arming its armed forces with better weapons. New weapons are subjected to extensive testing to ensure reliable operation and estimate the level of performance enhancement due to a newly integrated design change. In October 2018, the US Army concluded its qualification testing for a new proximity fuse, designed as an enhancement for Raytheon's Stinger missiles. The fuse-integrated missile achieved a perfect score against a variety of targets, which amplifies its lethality through proximal detonation while maintaining its hit-to-kill capability. The US Army plans to integrate its Stinger inventory with the new proximity fuse through issuing an Urgent Material Release contract as part of its Service Life Extension Program scheduled to be conducted at its ammo plant in McAlester, Oklahoma. The ongoing development of Next Generation Squad Weapons (NSGW) envisions to integrate a digital fire control system that is found on main battle tanks onto the assault rifle and machine guns deployed by the US Army. The NSGW program aims to field two new advanced weapons: the NGSW-Automatic Rifle (NGSW-AR) and the NGSW-Rifle. The integration of a digital fire control system would enable US troops to engage targets much swiftly and with enhanced precision to overpower their rivals with relative ease. Moreover, in December 2019, Raytheon Technologies Corporation was awarded a USD 123.5 million contract to supply additional MK 99 fire control systems for the Aegis weapon systems to be installed onboard the future Flight III Arleigh Burke-class guided-missile destroyers.
The Fire Control System Market is marked with the presence of major players such as Raytheon Technologies Corporation, Leonardo S.p.A., BAE Systems plc, Rheinmetall AG, ASELSAN A.S., and Thales Group among others. The market is highly competitive and the prominent players are competing for a larger market share. The stringent safety and regulatory policies in the defense segment are expected to restrict the entry of new players. Furthermore, since a contract for such sophisticated weapons requires high technological expertise and spans over several years, careful identification and continuous monitoring of associative risks are required to be undertaken to assess their effects on the operational parameters of the manufacturing company. The assessment includes consideration for technical requirements, the listing of scheduled and associated tasks, and detailed cost analysis. Furthermore, the sales of technology-based platforms are primarily influenced by the prevalent economic situations in dominant markets such as the US and Asia-Pacific. Hence, in periods of economic downturn, purchases may be subjected to deferral or cancellation and a relatively slower rate of adoption, which in turn, can adversely affect the market dynamics. Moreover, the contracts are often subjected to include offset clauses which enhances the risks of timely completion of the project. Since the associated risks regarding the technical aspects, scheduling of activities and costs are subjected to change based on macroeconomic factors and subsequently influence the associative profits of the associated parties in a contract.
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