Defense Spending on an Upswing in the U.S. and across the Globe despite concerns over Budgetary Deficits in the Post-COVID World
Defense spending in the U.S., the world’s largest, has been on a major upswing led by the resurgence of great power competition amongst leading geopolitical powers and spearheaded by R&D-led technological evolution. The realignment of U.S. defense spending, with renewed focus on competing with near-peer adversaries while sustaining traditional overmatch over adversaries, has accelerated the pace of recapitalization of ageing equipment with the award of several new defense contract awards over the recent years & many others in the pipeline. The same remains a key area of focus for the industry given their strategic nature, size, scale as well as scope & long term horizon.
The transition of the traditional world order towards multi-polarity, marked by the resurgence of great power competition and escalating geopolitical tensions, has effectively heralded a renaissance for the Global Aerospace & Defense industry over the recent years with defense spending clearly on the surge & a clear upswing. The rapid build-up of military capabilities by China and resurgence of Russia on the world horizon has effectively spiraled up defense spending across most regions & parts of the world. The global defense spending reached the $1.98 trillion level for 2020 growing by over 2.6% year on year for 2020 & 3% for 2019 echoing the Cold war-era trend.
However, this global defense spending spree is likely to face pressure from concerns over budgetary deficits caused by the global outbreak of the COVID-19 pandemic which has put significant pressure on government finances across most parts of the world. Additionally, Commercial Aviation had been in dire straits through 2020 with the industry literally battered by COVID-19 with the situation putting pressure on companies with exposure to commercial aviation, especially, Boeing & Airbus and their supply chains, with the behemoths recording one of their worst years ever. The ordeal is less painful for the industry so far in 2021 with domestic passenger traffic reaching pre-covid levels in the U.S. while across the EU it is almost at the 70% level. However, full recovery is projected to be realized only by 2024.
The shift in overarching strategic focus in the U.S. towards defense entails fast tracked procurement of systems & hardware to maintain numerical superiority, in addition, to rapid development & deployment of next generation capabilities and is geared towards plugging existing & potential capabilities gaps, retaining the traditional, long standing strategic capabilities overmatch against adversaries and expansion of capabilities through development & incorporation of cutting edge technologies. The existing U.S.’ delivery systems triad across land, air & sea is being replaced with next generation programs, namely, the B-21 LRSB, GBSD, JLTV, OMFV, NGAD and Virginia-class attack & Columbia-class ballistic missile submarines.
Against this backdrop, the report analyzes the U.S. Aerospace & Defense market in the post COVID-19 world and provides a comprehensive Comparative SWOT Framework & Strategy Focus Analysis on the Nation’s Top 5 Aerospace & Defense Companies. The report analyzes the overall, Near to Medium Term Strategy Focus and provides insights into the Key Strategies & Plans for the leading Aerospace & Defense Primes for the near to medium term horizon based on comparative assessment of:-
1. Business Portfolios Analysis & Strategic Positioning across Key Markets & Segments
2. Analysis of overall Cost Base, Structure & Management
3. Relative Presence & Positioning across Defense Programs
4. Analysis of Revenue Streams, Resource Base & Domain Competencies
5. Revenues & Profitability, Key Profit Sources, Growth & Trend Analysis
6. Capital & Ownership Structure and Financial Strength
7. Degree of Diversification
8. Order Backlog Position and Order Book Composition
9. International Presence across Key Geographic Markets & Regions – Breadth & Depth
10. Key Competitor Analysis across Segments & Degrees of Competitive Intensity
11. Competitive Market Positioning across Key Markets & Product Segments
12. Overall Strategy Orientation & Focus, R&D Strategy, Technological Strength & Capabilities
Relevance & Usefulness: The report will be useful for:-
- - Strategic Planning, Assessment & Decision-Making Processes
- - Competitor Analysis & Comparative Analysis of covered Industry OEMs
- - Identification of & Insights into Potential Growth Opportunities & Avenues
- - Analysis of Near to Medium Term Strategy Focus and Key Strategies & Plans for all OEMs
- - Identifying & highlighting areas for making potential Strategic Changes, Adjustments & Realignment
For Whom: Key Decision-Makers across Industry Value Chain
The report will be essential & a key resource for those associated with and having strategic interest in the U.S. or Global Aerospace & Defense Industry. The report will be especially useful for Key Decision-Makers & Senior Industry Executives apart from Program, Project & Procurement Managers, Defense Procurement Departments & Executives, Suppliers, Vendors, Technology & MRO Services Providers and other Key Players in the Industry Value Chain, Existing & potential Investors, Industry & Company Analysts, M&A Advisory Firms, Strategy & Management Consulting Firms, PE Firms, Venture Capitalists and Financing & Leasing Companies, Researchers and all those associated with the industry in general.