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The nuclear powered naval vessels market size is forecast to increase by USD 12.44 billion, at a CAGR of 8% between 2023 and 2028. The market growth analysis depends on several factors such as the cost-effectiveness of nuclear power, the rising military spending, and the focus on making submarines more undetectable.
Market Forecast 2024-2028
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Our researchers studied the market research and growth data for years, with 2023 as the base year and 2024 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The geopolitical tensions between countries have contributed to a significant increase in military spending worldwide, which is also a significant driver for defense equipment manufacturers. In 2023, the military expenditure of countries such as India, China, France, Saudi Arabia, and the US accounted for a major part of the overall defense market. These countries are modernizing their sea-based defense systems and militaries, which has propelled the demand for defense products.
For instance, in 2023, military spending in the US was announced to be USD 816.7 billion. In the fiscal year 2023-2024, the military budget allocated by the Government of India was around USD 50 billion, which is 13% of the entire budget. Thus, the increase in defense and military spending is likely to augment the deployment of nuclear-powered naval vessels, thus driving the growth of the market during the forecast period.
The development of a nuclear-powered naval vessel requires an efficient in-house technical team supported by exclusive technologies and domain expertise, along with large funding. Nowadays, the military equipment procurement pattern has evolved, and countries are now indigenously manufacturing nuclear-powered naval vessels. For instance, India's first nuclear-powered ballistic missile submarine, Arihant class, INS Arihant (S73), was built indigenously by the Indian Navy's Ship Building Centre in the port city of Visakhapatnam, India. INS Vindhyagiri, after its successful sea trials in February 2016, was confirmed and was commissioned in August 2023.
Furthermore, India domestically built its second nuclear-powered ballistic missile submarine, INS Aridhaman, at a fully enclosed dry dock at Vishakhapatnam. INS Aridhaman has one seven-blade propeller powered by a pressurized water reactor (PWR) and a maximum speed of 12-15 knots when on the surface and 24 knots when submerged. Such factors will boost the growth of the market during the forecast period.
The initial cost of construction of a nuclear-based propulsion system is twice the cost of other kinds of energy propulsion systems. Furthermore, the reactor requires specialist personnel to maintain and operate the nuclear plant, turbine, and generators, while diesel-electric generators and turbines require just a good motor mechanic. Additionally, air-independent propulsion (AIP) is a marine propulsion technology that allows non-nuclear submarines to operate without accessing atmospheric air/oxygen (by surfacing or using a snorkel). AIP can augment or replace both the diesel-electric propulsion system and the nuclear-powered naval vessels.
Moreover, the introduction of AIP has largely improved the underwater endurance of these submarines and has given them a distinct advantage. One of the main advantages of AIP technology is that it can be installed on existing generation submarines by inserting a new hull section during a retrofit. Therefore, navies across the globe are seen queuing up to buy or build submarines with AIP systems. Thus, such factors will impede market growth during the forecast period.
The surface vessels segment will account for a major share of the market's growth during the forecast period.?The surface vessels segment includes a variety of surface-based products, such as aircraft carriers, surface-based cruisers, surface-based destroyers, surface-based frigates, and more. Each surface vessel fulfills a unique purpose and reflects the changing strategic priorities and capacities of naval forces around the world. One of the main categories of surface vessels powered by nuclear is aircraft carriers, often referred to as the flagship of the naval fleet. These gigantic aircraft carriers act as mobile bases of operations, projecting power and power across vast sea areas.
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The surface vessels segment was valued at USD 12.82 billion in 2018. With the use of nuclear power, surface vessels can operate for extended periods of time without refueling, allowing for long-term and long-lasting deployments. For instance, aircraft carriers are powerful power projection platforms and mobile airbases that can carry and launch a wide variety of aircraft. Examples include the United States Navy's Gerald R. Ford class carrier and the Royal Navy's Queen Elizabeth-class carrier. These factors under the surface vessels segment will drive the growth of the market during the forecast period.
Application?Segment Analysis:
Based on application, the market has been segmented into defense and transportation. The defense segment will account for the largest share of this segment.?Nuclear-powered naval vessels are used for a variety of defense applications. There are several different types of vessels in the market, such as aircraft carriers, nuclear-powered submarines, and surface combatants. Aircraft carriers are an essential part of naval defense because they can project power over vast distances. In addition, the defense segment is also characterized by constant technological innovation. The development of reactor designs, propulsion systems, and stealth technologies has enabled the development of more advanced and efficient vessels. Thus, such factors under the defense segment will drive the growth of the market during the forecast period.
The Nuclear Powered Naval Vessels Market plays a crucial role in ensuring maritime security and projecting naval power across the globe. With advancements in naval technology, countries invest in nuclear propulsion systems to enhance the capabilities of their military fleet. Nuclear-powered submarines, equipped with advanced nuclear reactors, offer unmatched endurance and stealth, making them invaluable assets for naval operations and naval warfare.
As nations prioritize naval fleet modernization, the demand for nuclear-powered naval vessels continues to grow. These vessels play a pivotal role in safeguarding maritime interests and maintaining strategic deterrence. Moreover, ongoing developments in naval armaments and naval strategy further underscore the importance of nuclear-powered vessels in modern naval fleets.
Market stakeholders closely monitor industry dynamics and trends through comprehensive market reports to capitalize on emerging opportunities and navigate challenges in the nuclear powered naval vessels market.
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APAC is estimated to contribute 37% to the growth by 2028. Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. Another region offering significant growth opportunities to companies is North America. The high defense budget of the US is approximately 3.1% of the total country's budget in 2023 and makes it the leading region in the global market. The increasing spending from the defense department on the construction of nuclear-powered naval ships is likely to drive the growth of the market in the region. There are only three major naval forces (The US Navy, Royal Canadian Navy, and Mexican Navy) in North America, however, the US Nuclear Navy is one of the oldest and largest nuclear organizations in the world, Furthermore, the two primary reasons contributing to the adoption of nuclear-powered propulsion are the cost-benefit derived from the system and the time involved in replacing the core. Hence, such factors are expected to drive market growth in this region during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Babcock International Group Plc, BAE Systems Plc, Bechtel Corp., BWX Technologies Inc., Curtiss Wright Corp., General Dynamics Corp., Huntington Ingalls Industries Inc., Kongsberg Gruppen ASA, Lockheed Martin Corp., Naval Group, Northrop Grumman Corp., Rolls Royce Holdings Plc, and Thales Group
Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market analysis and report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
Market Scope |
|
Report Coverage |
Details |
Page number |
168 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 8% |
Market Growth 2024-2028 |
USD 12.44 billion |
Market structure |
Concentrated |
YoY growth 2023-2024(%) |
6.92 |
Regional analysis |
North America, APAC, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 37% |
Key countries |
US, China, India, Russia, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Austal Ltd., Babcock International Group Plc, BAE Systems Plc, Bechtel Corp., BWX Technologies Inc., Curtiss Wright Corp., General Dynamics Corp., Huntington Ingalls Industries Inc., Kongsberg Gruppen ASA, Lockheed Martin Corp., Naval Group, Northrop Grumman Corp., Rolls Royce Holdings Plc, and Thales Group |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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