The Australian Defense Sector Market Opportunities And Entry Strategies, Analyses And Forecasts

Summary

Summary

This report offers insights into the market opportunities and entry strategies adopted by foreign OEMs

(original equipment manufacturers) to gain a market share in the Australian defense industry. In

particular, it offers in-depth analysis of the following:

Market opportunity and attractiveness: detailed analysis of the current industry size and

growth expectations during 20102015, including highlights of the key growth stimulators. It also

benchmarks the industry against key global markets and provides detailed understanding of

emerging opportunities in specific areas.

Procurement dynamics: trend analysis of imports and exports, together with its implications and impact on the Australian defense industry.

Industry structure: five forces analysis to identify various power centers in the industry and how these are likely to develop in the future.

Market entry strategy: analysis of possible ways to enter the market, together with detailed descriptions of how existing players have entered the market, including key contracts, alliances, and strategic initiatives.

Competitive landscape and strategic insights: analysis of competitive landscape of the defense industry in Australia. It provides an overview of key defense companies (both domestic and foreign), together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Business environment and country risk: a range of drivers at country level, assessing business environment and country risk. It covers historical and forecast values for a range of indicators, evaluating business confidence, economic performance, infrastructure quality and

availability, labor force, demographics, and political and social risk.

Scope

analysis of Defense industry market size from 2004 through 2009 and forecasts till 2015

analysis of defense budget allocation

Benchmarking with key global markets

Market opportunities

Defense procurement dynamics

Industry dynamics

Market entry strategy

Competitive landscape and strategic insights

Business environment and country risk

Reasons To Buy

Gain insight into Australian defense industry with current, historic and forecast market values

Get insight on market opportunity and attractiveness

Get insight on industry procurement dynamics

Gain insight on industry structure

Gain insight into the regulations governing the Australian defense industry and the potential market entry strategies with an expert analysis of the competitive structure

Identify top companies of the Australian defense industry along with profiles of all those companies

Key Highlights

The Australian defense industry is expected to grow at a CAGR of 1.97% from a value of US$20.8 billion in 2009 to US$24.7 billion by 2015. Indeed, in 2009, the Australian government launched a new military modernization plan to upgrade its forces in order to counteract the threat posed by rising global terrorism, changing political dynamics in the Asia-Pacific region and the rising number of peacekeeping operations undertaken by the Australian forces. Furthermore, with the exception of a spike of 2.3% in 2009, defense expenditure as a percentage of its gross domestic product (GDP) is expected to increase from 1.9% in 2005 to 2.1% in 2015. However, while the capital expenditure as a percentage of defense budget peaked at 29.4% in 2009, the government is expected to decrease this value to 23.7% by 2015. This is due to the increased budget allocation for revenue expenditure in order to manage matters such as death and retirement benefits, and support services.

During the forecast period, the key market opportunities in the defense industry are expected to emerge in categories such as defense information technology, unmanned aerial vehicles (UAVs), helicopters, upgraded vehicles, armory, submarine rescue vehicles, sonar systems, troop protection equipment, patrolling ships, monitoring and security equipment.

Keywords

Defense, Australia, Raytheon Australia, Boeing Defense Australia, Saab Systems, General Dynamics Land systems Australia, Lockheed Martin Australia (LMA) , Navantia, Tenix Defense, Australian Aerospace , Serco Sodexho Defense Services (SSDS), Thales Australia, ASC, , , , , , , , , , , , , , , , ,

Table of Contents :

1 Introduction

1.1 About this Report

1.2 Definitions

1.3 Methodology

1.3.1 Secondary research

1.3.2 Primary research

1.3.3 Conventions

1.4 ICD Research Terrorism Index

1.5 About ICD Research Defense Intelligence Center

2 Executive Summary

3 Market Attractiveness and Emerging Opportunities

3.1 Defense Market Size and Forecast

3.1.1 Australian annual defense expenditure expected to reach US$24.7 billion by 2015

3.1.2 Defense expenditure driven by military modernization, terror threats, changing Asia-Pacific power dynamics and peacekeeping missions

3.2 Analysis of Defense Budget Allocation

3.2.1 Capital expenditure share to decrease to US$5.9 billion by 2015

3.2.2 Budget allocation for air force, navy and army expected to increase in the near term

3.2.3 Allocation for air force is expected to increase moderately in the forecast period

3.2.4 Navy expenditure expected to increase marginally during the forecast period

3.2.5 Army expenditure expected to increase at a CAGR of 3.78% in the forecast period

3.2.6 Budget allocation for defense support, intelligence and personnel expected to increase in line with defense budget

3.3 Homeland security market size and forecast

3.3.1 Border protection and aviation security to drive growth of homeland security budget

3.3.2 Terrorism and illegal fishing to drive homeland security expenditure

3.4 Benchmarking with Key Global Markets

3.4.1 Australia ranked fourteenth among top military spenders

3.4.2 Australian defense expenditure accounts for 1.5% of global spend

3.4.3 Defense expenditure as percentage of GDP to increase over forecast period

3.4.4 Australia ranked fourteenth among top arms importing countries

3.4.5 Australia ranked twenty ninth among top arms exporting countries

3.5 Market Opportunities: Key Trends and Growth Stimulators

3.5.1 Increased surveillance needs expected to drive demand for UAVs

3.5.2 NCW program expected to drive demand for communication, data management and networking technologies

3.5.3 Land fleet capacity expansion expected to drive demand for upgraded vehicles and armory

3.5.4 Submarines upgrade to drive the demand for submarine rescue vehicles, sonar systems, and ship management and control systems

3.5.5 Safety of troops continues to drive demand for protective equipment

3.5.6 Border security concerns expected to drive demand for patrol vessels, and monitoring and security equipment

4 Defense Procurement Market Dynamics

4.1 Import Market Dynamics

4.1.1 Defense imports expected to increase considerably over the forecast period

4.1.2 Germany loses market share of arms transfers with Australia to the US and France

4.1.3 Imports of aircraft and missiles continue to increase

4.2 Export Market Dynamics

4.2.1 Defense exports expected to increase during forecast period

4.2.2 Ships constitute majority of exports

5 Industry Dynamics

5.1 Five Forces Analysis

5.1.1 Bargaining power of supplier: low to medium

5.1.2 Bargaining power of buyer: high

5.1.3 Barrier to entry: high

5.1.4 Intensity of rivalry: medium to high

5.1.5 Threat of substitution: high

6 Market Entry Strategy

6.1 Market Regulation

6.1.1 AIC program ensures the participation of local industry

6.1.2 Approval for foreign investment in defense sector set at US$ 216.2 million

6.2 Market Entry Route

6.2.1 Establishing domestic subsidiary is preferred market entry route

6.2.2 Foreign OEMs sub-contract defense deals to domestic firms in order to enter the market

6.2.3 Foreign OEMs offer domestic companies access to global supply chains in order to enter the industry

6.2.4 DRSS provides opportunities to develop strong relations with the ADO

6.3 Key Challenges

6.3.1 Cost overruns and project delays continue to worry defense industry

6.3.2 Global supply chain pose challenge for foreign OEMs

7 Competitive Landscape and Strategic Insights

7.1 Competitive Landscape Overview

7.1.1 Eight established foreign OEMs dominate the Australian defense market

7.2 Key Foreign Companies

7.2.1 Raytheon Australia: overview

7.2.2 Raytheon Australia: product focus

7.2.3 Raytheon Australia: recent announcements and strategic initiatives

7.2.4 Raytheon Australia: alliances

7.2.5 Raytheon Australia: recent contract wins

7.2.6 Raytheon Australia: financial analysis

7.2.7 Boeing Defense Australia: overview

7.2.8 Boeing Defense Australia: product focus

7.2.9 Boeing Defense Australia: recent announcements and strategic initiatives

7.2.10 Boeing Defense Australia: alliances

7.2.11 Boeing Defense Australia: recent contract wins

7.2.12 Boeing Defense Australia: financial analysis

7.2.13 Saab Systems: overview

7.2.14 Saab Systems: product focus

7.2.15 Saab Systems: recent announcements and strategic initiatives

7.2.16 Saab Systems: alliances

7.2.17 Saab Systems: recent contract wins

7.2.18 Saab Systems: financial analysis

7.2.19 General Dynamics Land Systems Australia: overview

7.2.20 General Dynamics Land Systems Australia: product focus

7.2.21 General Dynamics Land Systems Australia: recent announcements and strategic initiatives

7.2.22 General Dynamics Land Systems Australia: alliances

7.2.23 General Dynamics Land Systems Australia: recent contract wins

7.2.24 General Dynamics Land Systems Australia: financial analysis

7.2.25 Lockheed Martin Australia: overview

7.2.26 Lockheed Martin Australia: product focus

7.2.27 Lockheed Martin Australia: recent announcements and strategic initiatives

7.2.28 Lockheed Martin Australia: alliances

7.2.29 Lockheed Martin Australia: recent contract wins

7.2.30 Lockheed Martin Australia: financial analysis

7.2.31 Navantia: overview

7.2.32 Navantia: product focus

7.2.33 Navantia: recent announcements and strategic initiatives

7.2.34 Navantia: alliances

7.2.35 Navantia: recent contract wins

7.2.36 Navantia: financial analysis

7.2.37 Tenix Defense: overview

7.2.38 Tenix Defense: products and services

7.2.39 Tenix Defense: recent announcements and strategic initiatives

7.2.40 Tenix Defense: alliances

7.2.41 Tenix Defense: recent contract wins

7.2.42 Tenix Defense: financial analysis

7.2.43 Australian Aerospace: overview

7.2.44 Australian Aerospace: products and services

7.2.45 Australian Aerospace: recent announcements and strategic initiatives

7.2.46 Australian Aerospace: alliances

7.2.47 Australian Aerospace: recent contract wins

7.2.48 Australian Aerospace: financial analysis

7.2.49 Serco Sodexho Defense Services: overview

7.2.50 Serco Sodexho Defense Services: products and services

7.2.51 Serco Sodexho Defense Services: recent announcements and strategic initiatives

7.2.52 Serco Sodexho Defense Services: alliances

7.2.53 Serco Sodexho Defense Services: recent contract wins

7.2.54 Serco Sodexho Defense Services: financial analysis

7.2.55 Thales Australia: overview

7.2.56 Thales Australia: products and services

7.2.57 Thales Australia: recent announcements and strategic initiatives

7.2.58 Thales Australia: alliances

7.2.59 Thales Australia: recent contract wins

7.2.60 Thales Australia: financial analysis

7.3 Key Public Sector Companies

7.3.1 ASC: overview

7.3.2 ASC: products and services

7.3.3 ASC: recent announcements and strategic initiatives

7.3.4 ASC: alliances

7.3.5 ASC: recent contract wins

7.3.6 ASC: financial analysis

8 Business Environment and Country Risk

8.1 Business Confidence

8.1.1 Business confidence index

8.1.2 Market capitalization trend - Australia Stock Exchange, Australia

8.1.3 FDI inflows by sector

8.1.4 Deployment of credit by sector

8.2 Economic Performance

8.2.1 GDP at constant prices

8.2.2 GDP per capita at constant prices

8.2.3 GDP at current prices

8.2.4 GDP per capita at current prices

8.2.5 GDP split by key segments

8.2.6 Agriculture output at current prices (AUD)

8.2.7 Agriculture output at current prices (US$)

8.2.8 Agriculture output at current prices as percentage of GDP

8.2.9 Manufacturing output at current prices (AUD)

8.2.10 Manufacturing output at current prices (US$)

8.2.11 Manufacturing output at current prices as percentage of GDP

8.2.12 Mining, manufacturing and utilities output at current prices (AUD)

8.2.13 Mining, manufacturing and utilities output at current prices (US$)

8.2.14 Mining, manufacturing and utilities output at current prices as percentage of GDP

8.2.15 Construction output at current prices (AUD)

8.2.16 Construction output at current prices (US$)

8.2.17 Construction output at current prices as a percentage of GDP

8.2.18 Crude steel production

8.2.19 Crude oil consumption

8.2.20 Inflation rate

8.2.21 Fiscal deficit as a percentage of GDP

8.2.22 Trade balance as a percentage of GDP

8.2.23 Exports as a percentage of GDP

8.2.24 Imports as a percentage of GDP

8.2.25 Exports growth

8.2.26 Imports growth

8.2.27 External debt as a percentage of GDP

8.2.28 Annual average exchange rate US$-AUD

8.2.29 End of the period exchange rate US$-AUD

8.3 Infrastructure Quality and Availability

8.3.1 Passenger vehicle production volume

8.3.2 Commercial vehicle production volume

8.3.3 Automotive component exports trend

8.3.4 Automotive component imports trend

8.3.5 Passenger car penetration

8.3.6 Total installed capacity for electricity generation

8.3.7 Installed capacity for conventional thermal electricity generation

8.3.8 Electricity production

8.3.9 Installed capacity for hydroelectricity generation

8.3.10 Installed capacity for renewable electricity generation

8.3.11 Electric power consumption

8.3.12 Healthcare expenditure

8.3.13 Healthcare expenditure as a percentage of GDP

8.3.14 Healthcare expenditure per capita

8.3.15 Total internet subscribers

8.3.16 Broadband internet subscribers

8.3.17 Mobile phone penetration rate

8.4 Labor Force

8.4.1 Labor force

8.4.2 Unemployment rate

8.5 Demographics

8.5.1 Annual disposable income

8.5.2 Annual per capita disposable income

8.5.3 Annual consumer expenditure on food

8.5.4 Urban and rural population

8.5.5 Females as a percentage of population

8.5.6 Males as a percentage of population

8.5.7 Mean age of population

8.5.8 Median age of population

8.5.9 Population density

8.5.10 Age distribution of the total population

8.5.11 Age distribution of the male population

8.5.12 Age distribution of the female population

8.5.13 Number of households

8.6 Political and Social Risk

8.6.1 Political stability

8.6.2 Terrorism index

8.6.3 Transparency index

List of Tables

Table 1: Countries with Largest Share of Arms Imports*, 200509

Table 2: Countries with Largest Share of Arms Exports*, 200509

Table 3: FATA Approval for Acquisition in Defense in Australia

Table 4: Key Foreign OEMS and Subsidiaries

Table 5: Small Projects with Cost Overruns

Table 6: Major Projects with Cost Overruns

Table 7: Project Delays

Table 8: Australian Defense Industry, Competitive Landscape

Table 9: Raytheon Australia - Alliances

Table 10: Raytheon Australia - Recent Contract Wins

Table 11: Boeing Defense Australia - Alliances

Table 12: Boeing Defense Australia - Recent Contract Wins

Table 13: Saab Systems- Alliances

Table 14: Saab Systems - Recent Contract Wins

Table 15: General Dynamics Land Systems Australia - Recent Contract Wins

Table 16: Lockheed Martin Australia - Alliances

Table 17: Lockheed Martin Australia - Recent Contract Wins

Table 18: Navantia - Alliances

Table 19: Navantia - Recent Contract Wins

Table 20: Tenix Defense - Alliances

Table 21: Australian Aerospace - Alliances

Table 22: Australian Aerospace - Recent Contract Wins

Table 23: Serco Sodexho Defense Services - Recent Contract Wins

Table 24: Thales Australia - Alliances

Table 25: Thales Australia - Recent Contract Wins

Table 26: ASC - Alliances

Table 27: ASC - Recent Contract Wins

List of Figures

Figure 1: Australian Defense Expenditure, Historical and Forecast (US$ Billion), 200415F

Figure 2: Australian Defense Expenditure as a Percentage of GDP (US$ Billion), 200415F

Figure 3: Australian Defense Budget Split between Revenue and Capital Expenditure (%), 200415F

Figure 4: Australian Defense Budget Allocation, 2010

Figure 5: Australian Defense Air Force Expenditure (US$ Billion), 200915F

Figure 6: Australian Defense Naval Expenditure (US$ Billion), 200915F

Figure 7: Australian Defense Army Expenditure (US$ Billion), 200915F

Figure 8: Australian Defense Other Expenditure (US$ Billion), 200915F

Figure 9: ICD Research Terrorism Heat Map

Figure 10: ICD Research Terrorism Index

Figure 11: Benchmarking with Key Global Markets Defense Expenditure Growth (%), 200415F

Figure 12: Countries with the Largest Defense Expenditure Worldwide (US$ Billion), 2009 and 2015F

Figure 13: Countries with the Largest Defense Expenditure as a Percentage of GDP Worldwide (%), 2009

Figure 14: Australian Defense Imports TIVs* (US$ Million), 200509

Figure 15: Australian Defense Imports by Country based on TIVs*, 2005 and 2009

Figure 16: Australian Defense Imports by Weapons based on TIVs*, 2005 and 2009

Figure 17: Australian Defense Exports by Weapons based on TIVs*, 200509

Figure 18: Industry Dynamics - Porters Five Forces Analysis

Figure 19: Saab Systems - Revenue Trend Analysis (US$ Million), FY200709

Figure 20: ASC - Revenue Trend Analysis (AUD Million),, FY200509

Figure 21: ASC - Operating Profit Trend Analysis (AUD Million),, FY200509

Figure 22: ASC - Net Profit Trend Analysis (AUD Million), FY200509

Figure 23: Australian Business Confidence Index, 200709

Figure 24: Australian Stock Exchange Market Capitalization Trend (US$ Billion), 200309

Figure 25: Australian FDI Inflows by Sector (US$ Billion), 200308

Figure 26: Australian Deployment of Credit by Sector (US$ Billion), 200309

Figure 27: Australian GDP at Constant Prices (US$ Billion), 200315F

Figure 28: Australian GDP Per Capita at Constant Prices (US$), 200315F

Figure 29: Australian GDP at Current Prices (US$ Billion), 200315F

Figure 30: Australian GDP per Capita at Current Prices (US$), 200315F

Figure 31: Australia GDP Split by Key Sectors (%) 2003 vs. 2009

Figure 32: Australian Agriculture Output at Current Prices (AUD Billion), 200315F

Figure 33: Australian Agriculture Output at Current Prices (US$ Billion), 200315F

Figure 34: Australian Agriculture Output at Current Prices as a Percentage of GDP (%), 200315F

Figure 35: Australian Manufacturing Output at Current Prices (AUD Billion), 200315F

Figure 36: Australian Manufacturing Output at Current Prices (US$ Billion), 200315F

Figure 37: Australian Manufacturing Output at Current Prices as a Percentage of GDP (%), 200315F

Figure 38: Australian Mining, Manufacturing and Utilities Output at Current Prices (AUD Billion), 200315F

Figure 39: Australian Mining, Manufacturing and Utilities Output at Current Prices (US$ Billion), 200315F

Figure 40: Australian Mining, Manufacturing and Utilities Output at Current Pri

by: Aarkstore Enterprise

POST COMMENT

Aluminium Alloy Sections Market Research In Russia The benefits of pay per click marketing The German Defense Sector Market Opportunities And Entry Strategies, Analyses And Forecasts Viscose Pulp Market Research In Russia Tips for online marketing The Indian Defense Sector Market Opportunities And Entry Strategies, Analyses Designing Successful Logo Design For Uk Market What Jessica Simpson Products Have Been Launched In The Market? Gypsum And Gypsum Stone Market Research In The Cis Apple Iphone Deals Enjoy Height Of Performance With Profitable Communication Wealthy Affiliate: The Basics Of List Building And Email Marketing Float Glass Market Research In Russia Retail Therapy Hippie Style At Goas One And Only Anjuna Flea Market