Missile Defense System Market Report 2025

The missile defense system market size has grown rapidly in recent years. It will grow from $31.13 billion in 2024 to $34.68 billion in 2025 at a compound annual growth rate (CAGR) of 11.4%. The growth in the historic period can be attributed to government spending & defense budgets, terrorism and asymmetric threats, treaties and agreements, strategic defense initiative (SDI), space race influence.

The missile defense system market size is expected to see strong growth in the next few years. It will grow to $50.28 billion in 2029 at a compound annual growth rate (CAGR) of 9.7%. The growth in the forecast period can be attributed to impact of arms control agreements, geopolitical instability, emerging threats, military modernization programs, space-based defense systems. Major trends in the forecast period include intercontinental ballistic missile (ICBM) threats, hypersonic weapons development, drone and UAV threats, directed energy weapons advancements, artificial intelligence integration.

The anticipated upsurge in global defense spending is poised to propel the growth of the missile defense system market in the forthcoming forecast period. This surge in defense expenditure enables the adoption of vital but costly missile defense system technologies. Advancements in weaponry and offensive capabilities on a global scale have spurred governments' imperative to deploy defense technologies as a preemptive measure against potential threats from foreign entities. For instance, as reported by the Stockholm International Peace Research Institute in April 2023, total global military expenditure surged by 3.7% in real terms in 2022, reaching a record high of $2.24 trillion. In 2022, Russian military spending is estimated to have increased by 9.2%, amounting to $86.4 billion. Additionally, the collective military expenditure in Asia and Oceania stood at $575 billion, marking a 2.7% increase compared to 2021. Consequently, this substantial increase in global defense spending serves as a primary impetus behind the growth trajectory of the missile defense system market.

The rising geopolitical tensions are expected to drive growth in the missile defense system market. Geopolitical tensions involve political conflicts, rivalries, or disputes between nations or regions, often centered on issues like territory, resources, power, or ideology. As these tensions escalate, countries tend to prioritize security measures, invest in advanced technologies, and pursue military modernization to counter perceived missile threats, leading to increased demand for missile defense capabilities worldwide. For instance, in July 2024, The Armed Conflict Location & Event Data Project (ACLED), a US-based non-profit organization, reported over 165,273 incidents of political violence globally, representing a 15% increase from July 2023 to June 2024. Thus, the escalating geopolitical tensions are driving the growth of the missile defense system market.

Major companies in the missile defense system market are concentrating on developing advanced products, including self-defense systems, to enhance protection against evolving threats. A self-defense system is an integrated technology designed to automatically detect, track, and intercept incoming threats, providing a critical layer of protection against potential attacks. For instance, in July 2023, BAE Systems, a UK-based aerospace company, announced the Next Generation Evolved SeaSparrow Missile Launch System (NGELS) for the US Navy. This system will employ the Evolved SeaSparrow Missile (ESSM) and is intended to strengthen naval air defense capabilities against modern threats. The NGELS will feature a fixed-angle launcher and will integrate proven technology from the Mk 41 Vertical Launching System, supporting various surface-to-air and surface-to-surface defense operations.

Key players in the missile defense system market are prioritizing strategic collaborations to ensure steadfast services for their clientele. Such collaborations entail mutually advantageous partnerships between independent entities, aiming to achieve common goals that align with their respective strategic objectives. An exemplar occurred in December 2022 when Lockheed Martin Corporation, a US-based aerospace company, disclosed a collaboration with Rafael Advanced Defense Systems Ltd., an Israel-based defense technology firm. The agreement involves joint efforts by Lockheed Martin and Rafael Advanced Defense Systems to develop, test, and manufacture High Energy Laser Weapon Systems (HELWS) across facilities in both the U.S. and Israel. Building upon Rafael's innovative IRON BEAM project, which features a 100kW-class High Energy Laser Weapon System tailored for ground-based air defense, this collaboration seeks to expand and refine this cutting-edge technology for introduction into the American market. The collective endeavor aims to bolster air and missile defense capabilities using advanced laser technology, specifically targeting emerging threats such as rockets, mortars, and UAVs. Additionally, the partnership explores avenues for broader applications within the United States and potentially in other global arenas.

In July 2023, L3Harris Technologies Inc., a prominent US-based aerospace and defense company, completed the acquisition of Aerojet Rocketdyne Holdings Inc. for an undisclosed financial sum. This strategic move has fortified L3Harris' defense industrial base, fostering increased competition and expediting innovation. The acquisition has also diversified L3Harris' portfolio by integrating Aerojet Rocketdyne's expertise in propulsion systems. This collaboration positions L3Harris at the forefront of advancements in critical areas such as missile defense systems, hypersonics, and advanced rocket engines. Aerojet Rocketdyne Holdings Inc., the acquired company, is a US-based aerospace and defense entity renowned for its specialization in propulsion systems and energetics.

Major companies operating in the missile defense system market include The Boeing Company, Lockheed Martin Corporation, China Aerospace Science and Technology Corporation (CASC), General Dynamics Corporation, Honeywell International Inc., BAE Systems plc, NEC Corporation, Safran S.A., Thales Group, L3Harris Technologies Inc., Leonardo S.p.A., Leidos Holdings Inc., Raytheon Intelligence & Space - a business segment of Raytheon Technologies Corporation, Textron Systems Corporation, Northrop Grumman Corporation - Mission Systems Sector, Rheinmetall AG, Elbit Systems Ltd., Israel Aerospace Industries Ltd., Israel Military Industries Ltd. (IMI), MBDA France, Diehl Defence GmbH & Co KG, Kongsberg Gruppen ASA, Rafael Advanced Defense Systems Ltd., DRS Technologies Inc., Hanwha Defense Systems Co Ltd., LIG Nex1 Co Ltd., CEA Technologies SAS.

North America was the largest region in the missile defense system market in 2024. North America is expected to be the fastest-growing region in the forecast period. The regions covered in the missile defense system market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the missile defense system market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Missile defense systems encompass technologies or weaponry dedicated to tracking, detecting, and neutralizing attacking missiles. These systems are meticulously designed to swiftly address threats, with some forward-based missile defense systems capable of effectively countering rival aircraft and air-launched cruise missiles in their missions.

Missile defense systems rely on several key technologies, including the fire control system, weapon system, countermeasure system, and command and control system. The fire control system comprises components collaborating to aid the weapon system in tracking and targeting intended objectives. These systems span multiple domains such as ground, air, marine, and space, offering coverage across short, medium, and long ranges. The diversity of threat types addressed by missile defense systems includes subsonic, supersonic, and hypersonic missiles.

The missile defense system market research report is one of a series of new reports that provides missile defense system market statistics, including missile defense system industry global market size, regional shares, competitors with a missile defense system market share, detailed missile defense system market segments, market trends and opportunities, and any further data you may need to thrive in the missile defense system industry. This missile defense system market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The missile defense system market consists of sales of missile defense system components including satellite sensors, interceptors, and command and control. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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