Key Highlights:
Australian defense is considered one of the world’s growth markets, even in the recent tough years. 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 Australian forces. With the exception of an anomaly in 2010, defense expenditure as a percentage of Australia’s gross domestic product (GDP) is expected rise consistently through 2016. In the years after, this rate is expected to be reduced again, to cover increased sustainment costs.
Over 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.
This 156 page report provides a top level overview of the Australian defense industry, offering insights into market opportunities and entry strategies adopted by foreign OEMs to gain a market share in the Australian defense market. In particular, it offers in-depth analysis of defense market size from 2005 through 2010 and forecasts till 2016 and provides an insight into the Australian defense market and industry with current, historic and forecast market values.
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Content:
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• Top level overview of the Australian defense industry
• A breakdown of the Australian defense industry by spend pattern valued from 2005 through 2010 and forecasted from 2011 through 2016
• A breakdown of the markets by segments valued from 2005 through 2010 and forecasted from 2011 through 2016
• Details of top companies active across the Australian defense industry
• Emerging trends and opportunities in the Australian defense industry in the last 12 months
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Summary
This report offers insights into market opportunities and entry strategies adopted by foreign OEMs 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 market size and growth expectations during 2011–2016, including highlights of the key drivers, to aid understanding of the growth dynamics. It also benchmarks the sector against key global markets and provides detailed understanding of emerging opportunities in specific areas.
• Procurement dynamics: Trend analysis of imports and exports, along with their 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, along with knowledge of how existing companies have entered the market, including key contracts, alliances, and strategic initiatives.
• Competitive landscape and strategic insights: Analysis of the competitive landscape of defense manufacturers in Australia. It provides an overview of the key defense companies (both domestic and foreign) along 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.
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Summary
• Analysis of defense industry market size from 2005 through 2010 and forecasts till 2016
• 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
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Reasons To Buy
• Gain insight into the Australian defense industry with current, historic and forecast market values
• Gain insight into market opportunity and attractiveness
• Gain insight into industry procurement dynamics
• Gain insight into industry structure
• Gain insight into 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
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Table of Contents
1 Introduction
1.1 What is this Report About?
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
1.6 About Strategic Defence Intelligence (www.strategicdefenceintelligence.com)
2 Executive Summary
3 Market Attractiveness and Emerging Opportunities
3.1 Defense market Size Historical and Forecast
3.1.1 Australian annual defense expenditure expected to reach US$XX.XX billion by 2015
3.1.2 Defense expenditure driven by military modernization, terror threats, changing Asia-Pacific power dynamics and peacekeeping missions
3.1.3 Defense expenditure as a percentage of GDP expected to remain at XX.XX% during the forecast period
3.2 Analysis of Defense Budget Allocation
3.2.1 Capital expenditure share to increase to US$XX.XX billion by 2016
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 XX.XX% 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 Homeland security market expected to grow at a CAGR of XX.XX% in the forecast period
3.3.2 Border protection and aviation security to drive growth of homeland security budget
3.3.3 Terrorism and illegal fishing to drive homeland security expenditure
3.4 Benchmarking with Key Global Markets
3.4.1 Australian defense expenditure expected to remain modest compared to leading spenders
3.4.2 Australian defense expenditure accounts for XX.XX% of global spend
3.4.3 Defense expenditure as percentage of GDP to increase over forecast period
3.4.4 Australia ranked XX among top arms importing countries
3.4.5 Australia ranked XX among top arms exporting countries
3.5 Market Opportunities: Key Trends and Drivers
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 Anlysis
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 a domestic subsidiary is the 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
7.2 Key Public Sector Companies
7.2.1 Raytheon Australia: Overview
7.2.2 Raytheon Australia: Major Products and Services
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: Major Products and Services
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: Major Products and Services
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: Major Products and Services
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: Major Products and Services
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: Major Products and Services
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: Major 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 Aanalysis
7.2.43 Australian Aerospace: Overview
7.2.44 Australian Aerospace: Major 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 Aanalysis
7.2.49 Serco Sodexho Defense Services: Overview
7.2.50 Serco Sodexho Defense Services: Major 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: Major 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: Major 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 indicator
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
9 Appendix
9.1 Contact Us
9.2 About ICD Research
9.3 Disclaimer
List of Tables
Table 1: Australian Defense Expenditure (2005–2010)
Table 2: Australian Defense Expenditure (2011–2016)
Table 3: Defense Expenditure as a % of GDP (2005–2010)
Table 4: Defense Expenditure as a % of GDP (2011–2016)
Table 5: Australian Defense budget Split between Capital and Revenue Expenditure (2005–2010)
Table 6: Australian Defense budget Split between Capital and Revenue Expenditure (2011–2016)
Table 7: Australian Air Force Defense Expenditure (2005–2010)
Table 8: Australian Air Force Defense Expenditure (2011–2016)
Table 9: Australian Navy Defense Expenditure (2005–2010)
Table 10: Australian Navy Defense Expenditure (2011–2016)
Table 11: Australian Army Defense Expenditure (2005–2010)
Table 12: Australian Army Defense Expenditure(2011–2016)
Table 13: Australian Other Defense Expenditure (2005–2010)
Table 14: Australian Other Defense Expenditure (2011–2016)
Table 15: Australian Homeland Security Expenditure (2005–2010)
Table 16: Australian Homeland Security Expenditure (2011–2016)
Table 17: Benchmarking with Key Markets, 2005–2010 vs 2011–2016
Table 18: Benchmarking with Large Defense Spenders in the World, 2010 and 2016
Table 19: Top Country Ranking by Arms Imports by Volume, (2005–2010)
Table 20: Top Country Ranking by Arms Exports by Volume, (2005–2010)
Table 21: FATA Approval for Acquisition in Defense in Australia
Table 22: Key Foreign OEMS and Subsidiaries
Table 23: Small Projects with Cost Overruns
Table 24: Major Projects with Cost Overruns
Table 25: Project Delays
Table 26: Raytheon Australia – Major Products & Services
Table 27: Raytheon Australia – Alliances
Table 28: Raytheon Australia – Recent Contract Wins
Table 29: Boeing Defense Australia – Major Products & Services
Table 30: Boeing Defense Australia – Alliances
Table 31: Boeing Defense Australia – Recent Contract Wins
Table 32: Saab Systems – Major Products & Services
Table 33: Saab Systems – Alliances
Table 34: Saab Systems – Recent Contract Wins
Table 35: General Dynamics Land Systems Australia – Major Products & Services
List of Figures:
Figure 1: Australian Defense Expenditure (2005–2010)
Figure 2: Australian Defense Expenditure (2011–2016)
Figure 3: Defense Expenditure as a % of GDP (2005–2010)
Figure 4: Defense Expenditure as a % of GDP (2011–2016)
Figure 5: Australian Defense budget Split between Capital and Revenue Expenditure (2005–2010)
Figure 6: Australian Defense budget Split between Capital and Revenue Expenditure (2011–2016)
Figure 7: Australian Defense Budget Allocation (2011)
Figure 8: Australian Air Force Defense Expenditure (2005–2010)
Figure 9: Australian Air Force Defense Expenditure (2011–2016)
Figure 10: Australian Navy Defense Expenditure (2005–2010)
Figure 11: Australian Navy Defense Expenditure (2011–2016)
Figure 12: Australian Army Defense Expenditure (2005–2010)
Figure 13: Australian Army Defense Expenditure (2011–2016)
Figure 14: Australian Other Defense Expenditure (2005–2010)
Figure 15: Australian Other Defense Expenditure (2011–2016)
Figure 16: Australian Homeland Security Expenditure (2005–2010)
Figure 17: Australian Homeland Security Expenditure (2011–2016)
Figure 18: ICD Research Terrorism Heat Map
Figure 19: Benchmarking with Key Markets, 2005–2010 vs 2011–2016
Figure 20: Benchmarking with Large Defense Spenders in the World, 2010 and 2016
Figure 21: Benchmarking with Large Defense Spenders as % of GDP, 2010 and 2016
Figure 22: Australiann Defense Imports (TIV s), 2005–2010
Figure 23: Australian Defense Imports by Country based on TIVs*, 2005–2010 and 2010
Figure 24: Australian Defense Imports by Weapons based on TIVs*, 2005–2010 and 2010
Figure 25: Australian Defense Exports (US$ Million), 2005–2010
Figure 26: Australian Defense Exports by Weapons based on TIVs*, 2005–2010 and 2010
Figure 27: Industry Dynamics – Porter’s Five Forces Analysis
Figure 28: ASC – Revenue Trend Analysis (AUD Million), 2006–2010
Figure 29: ASC – Operating Profit Trend Analysis (AUD Million), 2006–2010
Figure 30: ASC – Net Profit Trend Analysis (AUD Million), 2006–2010
Figure 31: Australian Business Confidence Index, 2007–2009
Figure 32: Australian Stock Exchange Market Capitalization Trend (US$ Billion), 2003–2009
Figure 33: Australian FDI Inflows by Sector (US$ Billion), 2003–2008
Figure 34: Australian Deployment of Credit by Sector (US$ Billion), 2003–2009
Figure 35: Australian GDP at Constant Prices (US$ Billion), 2003–2015
Figure 36: Australian GDP Per Capita at Constant Prices (US$), 2003–2015
Figure 37: Australian GDP at Current Prices (US$ Billion), 2003–2015
Figure 38: Australian GDP per Capita at Current Prices (US$), 2003–2015
Figure 39: Australia GDP Split by Key Sectors (%) 2003 vs. 2009
Figure 40: Australian Agriculture Output at Current Prices (AUD Billion), 2003–2015
Figure 41: Australian Agriculture Output at Current Prices (US$ Billion), 2003–2015
Figure 42: Australian Agriculture Output at Current Prices as a Percentage of GDP (%), 2003–2015
Figure 43: Australian Manufacturing Output at Current Prices (AUD Billion), 2003–2015
Figure 44: Australian Manufacturing Output at Current Prices (US$ Billion), 2003–2015
Figure 45: Australian Manufacturing Output at Current Prices as a Percentage of GDP (%), 2003–2015
Figure 46: Australian Mining, Manufacturing and Utilities Output at Current Prices (AUD Billion), 2003–2015
Figure 47: Australian Mining, Manufacturing and Utilities Output at Current Prices (US$ Billion), 2003–2015
Figure 48: Australian Mining, Manufacturing and Utilities Output at Current Prices as a Percentage of GDP (%), 2003–2015
Figure 49: Australian Construction Output at Current Prices (AUD Billion), 2003–2015
Figure 50: Australian Construction Output at Current Prices (US$ Billion), 2003–2015
Figure 51: Australian Construction Output at Current Prices as a Percentage of GDP (%), 2003–2015
Figure 52: Australian Crude Steel Production (Thousand metric Tons), 2003–2015
Figure 53: Australian Crude Oil Consumption (Million Metric Tons), 2003–2015
Figure 54: Australian Inflation Rate (%), 2003–2015
Figure 55: Australian Fiscal Deficit as a Percentage of GDP (%), 2003–2015
Figure 56: Australia Trade Balance as a Percentage of GDP (%), 2003–2009
Figure 57: Australian Exports as a Percentage of GDP (%), 2003–2015
Figure 58: Australian Imports as a Percentage of GDP (%), 2003–2015
Figure 59: Australian Exports Growth Rate (%), 2003–2015
Figure 60: Australian Imports Growth Rate (%), 2003–2015
Figure 61: Australian External Debt as a Percentage of GDP (%), 2003–2009
Figure 62: Australian Annual Average Exchange Rate US$-AUD, 2003–2009
Figure 63: Australian End of Fiscal Exchange Rate US$-AUD, 2003–2009
Figure 64: Australian Passenger Vehicle Production (Thousand units), 2003–2015
Figure 65: Australian Commercial Vehicle Production (Thousand units), 2003–2015
Figure 66: Australian Automotive Component Exports (US$ Billion), 2003–2015
Figure 67: Australian Automotive Component Imports (US$ Billion), 2003–2015
Figure 68: Australian Passenger Car Penetration (per Thousand People), 2003–2015
Figure 69: Australian Total Installed Capacity for Electricity Generation (Million Kilowatts), 2003–2015
Figure 70: Australian Installed Capacity for Conventional Thermal Electricity Generation (Million Kilowatts), 2003–2015
Figure 71: Australian Electricity Production (Billion Kilowatts Hours), 2003–2015
Figure 72: Australia Installed Capacity for Hydroelectricity Generation (Million Kilowatts), 2003–2015
Figure 73: Australian Installed Capacity for Renewable Electricity Generation (Billion Kilowatt hours), 2003–2015
Figure 74: Australian Electric Power Consumption (Billion Kilowatt Hours), 2003–2015
Figure 75: Australian Healthcare Expenditure (US$ Billion), 2003–2015
Figure 76: Australia Healthcare Expenditure as a Percentage of GDP (%), 2003–2015
Figure 77: Australian Healthcare Expenditure per Capita (US$), 2003–2015
Figure 78: Australian Internet Subscribers (Million), 2003–2015
Figure 79: Australian Broadband Internet Subscribers (Million), 2003–2015
Figure 80: Australian Mobile Phone Penetration per Square Kilometer (%), 2003–2015
Figure 81: Australian Labor Force (Million People), 2003–2015
Figure 82: Australian Unemployment Rate (%), 2003–2015
Figure 83: Australian Annual Disposable Income (US$ Billion), 2003–2015
Figure 84: Australian Annual per Capita Disposable Income (US$), 2003–2015
Figure 85: Australian Consumer Expenditure on Food (US$ Billion), 2003–2015
Figure 86: Australian Urban and Rural Population (%), 2003–2015
Figure 87: Australian Female as Percentage of Population (%), 2003–2015
Figure 88: Australian Males as a Percentage of Population (%), 2003–2015
Figure 89: Australia Mean Age of Population, 2003–2015
Figure 90: Australian Median Age of Population, 2003–2015
Figure 91: Australia Population Density per Square Kilometer, 2003–2015
Figure 92: Australian Age Distribution of the Total Population (%), 2003–2015
Figure 93: Australian Age Distribution of the Male Population (%), 2003–2015
Figure 94: Australian Age Distribution of the Female Population (%), 2003–2015
Figure 95: Australia Number of Households (Million), 2003–2015
Figure 96: ICD Research Terrorism Heat Map, 2010
Figure 97: Australia Transparency Index, 2003–2009
