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Military Logistics Market size is anticipated to observe substantial growth by 2032 end, due to rise in military activities across the globe. Besides, growing military spending is projected to open new prospects for military logistics industry through the forthcoming years. According to SIPRI estimates, the global military spending reached an all-time high of USD 2.1 trillion in 2021.
Major countries including the U.S. and Russia have their military posts in various countries of the Middle East and Africa regions The rise in cross border military trade and troops posting across several countries will generate an overwhelming market demand for military logistics.
The Russian invasion of Ukraine in early 2022 has offered a considerable boost to the adoption of military logistics. Potential increase in influx of huge military weapons, medical assistance, and military troops during the war has significantly propelled the market dynamics of late. As of June 2022, Relief announced providing nearly 650 tons of medical aid and supplies along with more than USD 14 million in direct financial assistance to different organizations in Ukraine.
Technological proliferation and amalgamation of various connected technologies will support market growth. Numerous industry participants, in association with defense bodies, are making use of drones and Unmanned Aerial vehicles (UAV) for military logistics. This will drastically reduce delivery time along with deceasing the operational cost. In January 2022, the U.S. Army publicized its plans of testing UAV drones, equipped with autonomous technology, that could deliver critical medical supplies to the battlefield.
The military logistics market by mode of transportation is segmented into airways, seaways, and land ways. The airways segment is expected to witness a lucrative growth rate over the forecast timeframe due to the introduction of various options including UAV in military logistics. The land ways segment will also witness notable growth attributed to the integration of various Unmanned Ground Vehicles (UGV) with logistics services such as Search and Rescue (SAR), military goods transportation, firefighting, and combat support.
The demand for military logistics is likely to be felt by army due to its proliferated scope of application for the army men. Various army bases stationed in hostile environments are generating a continuous demand for military food supplies and other necessities, posing a requirement for an effective military logistics network.
From the regional point of view, Asia Pacific military logistics market is expected to witness a significant growth rate over the forecast timeframe due to increasing military activities across the region. Increase in defense budget for acquisition of armaments, efforts by regional governments to boost indigenous production capabilities in the defense sector, and establishment of various military bases within countries to safeguard borders are some of the key market drivers of Asia Pacific. For instance, the Chinese government announced a defense budget of approximately USD 229 billion for 2022, depicting a 7.1% increase from 2021.
Major industry participants present in the military logistics market include AECOM, ANHAM, Lockheed Martin, KBR, DynCorp International, BAE Systems, Thales Group, Honeywell International Inc., ASELSAN A.S., Fluor Corporation, and Genco. These key players are undergoing horizontal and vertical integration to increase their service offerings and provide one-point solutions to various military organizations.
Contract offerings by leading companies for maintenance operations would offer new growth prospects for market expansion. To illustrate, Thales was recently awarded a 10-year contract under the VASSCO program by the French defense ministry’s aeronautical maintenance directorate (DMAe). The contract is expected to deliver through-life support for the principal components of the national air command and control system.