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The naval vessels market size is estimated to grow by USD 124.3 billion, at a CAGR of 16.81% between 2023 and 2028. The market is experiencing significant growth, driven by increasing investment in maritime surveillance capabilities to enhance national security and border control. This trend is particularly prominent in regions with extensive coastlines, such as Asia-Pacific and Europe. Another key trend is the emergence of three-dimensional (3D) printing and composite materials in naval vessel construction, which offers cost savings, improved design flexibility, and enhanced performance. Additionally, the integration of unmanned underwater vehicles (UUVs) and smart weapons is becoming increasingly important, enhancing operational capabilities and combat effectiveness. However, the market also faces operational challenges, including the need for vessels to operate in increasingly complex and contested waters, as well as the need to reduce environmental impact through the adoption of green technologies. Design challenges include the need to balance operational requirements with cost constraints and the need to integrate advanced technologies, such as UUVs and smart weapons, into vessel designs. Overall, the market is expected to continue growing, driven by these trends and challenges, with a focus on innovation and sustainability.
Market Forecast 2024-2028
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The destroyers segment will account for a major share of the market's growth during the forecast period.? A destroyer is a type of naval vessel that is designed for high-speed operations, long endurance, and multi-mission capabilities. Basically, destroyers are smaller than cruisers and battleships but larger than frigates and corvettes. Destroyers are known for their versatility and firepower. Thus, making them a crucial component of modern naval vessels. The main role of a destroyer is support to other larger ships and to provide protection, such as aircraft carriers or amphibious assault ships.
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The destroyers segment was valued at USD 19.50 billion in 2018.?Destroyers have advanced features such as anti-craft, anti-submarine, and anti-surface capabilities, enabling them to defend against threats from air, sea, and underwater domains. Guided missiles, torpedoes, cannons, cutting-edge radar and sonar systems, and more are all available on destroyers. These ships frequently perform tasks including engaging surface ships, carrying out anti-submarine warfare operations, providing air defense, enforcing blockades, and assisting land operations with seaside air raids. Thus, destroyers will continue to dominate this market during the forecast period.
Based on application, the market has been segmented into search and rescue, combat operations, MCM operations, and coastal surveillance. The search and rescue?segment will account for the largest share of this segment.?Naval vessels play an important role in search and rescue operations, particularly in the marine environment. Naval vessels are often equipped to respond quickly to suffering calls and emergencies at sea. Their speed and mobility allow them to reach the affected areas on time and provide quick assistance to those in need.
Moreover, to conduct rescue operations effectively naval vessels are designed with specialized equipment and facilities. Guided missiles, torpedoes, cannons, cutting-edge radar and sonar systems, and more are all available on destroyers. These ships frequently perform tasks including engaging attacking surface ships, carrying out anti-submarine warfare operations, providing air defense, and assisting land operations with sea side air-raid. Therefore, the search and rescue segment by application is contributing to the growth of the market during the forecast period.
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North America is estimated to contribute 48% to the growth by 2028. Technavio's analysts have elaborately explained the regional trends, drivers, and challenges that are expected to shape the market during the forecast period. With the US and Canada as the main nations, North America is the leading revenue-generating district in the worldwide maritime vessels market. Factors, for example, the rising examination and interest in the advancement of maritime vessels drive the development of the market in the district.
Due to the rising efforts toward modernizing its naval combat capabilities, the US Department of Defense (DoD) is likely to add more advanced naval vessels for the US Navy. Amid rising tensions in the Middle East and APAC, the US continues to maintain various naval bases overseas as a strategic move. Due to the rising budget allocation, new funding, and changes in the fleet type, it is expected that the demand for naval vessels will increase in the US which will further grow this region during the forecast period.
The market is influenced by various factors, including global defense spending and technological advancements. The market is driven by procurement and development activities aimed at enhancing naval capabilities. However, challenges such as delays and extra expenditures in the air defense manufacturing sector impact market growth. Geopolitical tensions and maritime disputes also play a role in shaping the market landscape. Shipbuilders face the challenge of reducing production rates amid fluctuating demand. Comprehensive intelligence on products, pricing, and customers is essential for navigating this complex market successfully.
Increasing investment in maritime surveillance capabilities is notably driving market growth. The market is witnessing significant growth due to geopolitical tensions and marine disputes that necessitate the enhancement of naval capabilities. Defense spending and procurement activities are on the rise as nations seek to maintain a qualitative technological edge in maritime combat capabilities. Advanced features such as 3D printing, integrated technologies, and silent engine operations are increasingly being incorporated into naval vessels, including Destroyers, Corvettes, Submarines, Amphibious ships, Frigates, and Auxiliary vessels.
Vendors like BAE Systems are focusing on developing advanced submarine systems with ballistic missile, guided missile, and conventional attack submarines, as well as torpedo targeting technologies and underwater detection and surveillance systems. These advancements are crucial for ensuring effective combat operations, search and rescue missions, and strategic stability in the face of global geopolitical conflicts and terrorism activities. Technological advancements continue to play a pivotal role in naval fleets, with a comprehensive underwater study and enemy territories being a key focus for enhancing maritime security. Thus, such factors are driving the growth of the market during the forecast period.
The emergence of three-dimensional (3D) printing and composite materials is the key trend in the market. The market is witnessing significant advancements due to geopolitical tensions and marine disputes that necessitate the enhancement of naval capabilities. BAE Systems, a leading defense contractor, is exploring the use of 3D printing technology for manufacturing parts and components of combat vessels, including destroyers, corvettes, frigates, and submarines. This technology enables the creation of complex structures in successive layers using computer-controlled machinery. Stratasys, a US-based digital manufacturing technology provider, employs proprietary fused deposition modeling (FDM) and polyjet technologies for 3D printing applications in submarines and associated sensors. Advanced features, such as silent engine operations, torpedo targeting technologies, and integrated technologies, are being incorporated into naval fleets to enhance maritime combat capabilities and ensure a qualitative technological edge. Defense spending and procurement activities are on the rise due to geopolitical uncertainties and economic factors, driving the demand for advanced submarine systems, including ballistic missile and guided missile submarines, and conventional and advanced attack submarines.
Further, 3D printing technology also facilitates the production of underwater detection and surveillance systems, enabling comprehensive underwater studies and enhancing the ability to monitor enemy territories and counteract terrorism activities. Global geopolitical conflicts and the threat of missile attacks necessitate underwater detection and surveillance, making this technology increasingly valuable for naval forces. Thus, such trends will shape the growth of the market during the forecast period.
Design and operational challenges is the major challenge that affects the growth of the market. The market encompasses a diverse range of watercraft, including Destroyers, Corvettes, Submarines, Amphibious ships, Frigates, and Auxiliary vessels. These vessels play a crucial role in combat operations, search and rescue, and geopolitical tensions arising from marine disputes and naval capabilities. BAE Systems and other leading defense manufacturers continue to invest in technological advancements, such as 3D printing and integrated technologies, to enhance maritime combat capabilities and secure a qualitative technological edge. Geopolitical uncertainties and economic factors fuel procurement activities for naval fleets. Advanced features, such as silent engine operations, torpedo targeting technologies, ballistic missiles, and guided missiles, are increasingly being integrated into combat vessels to counteract underwater detection, surveillance, and potential missile attacks. Nuclear attack and conventional attack submarines, as well as advanced submarine systems, are essential components of underwater defense strategies.
However, naval vessels face unique challenges when operating underwater. Communication is limited due to ocean waves distorting transmissions and ocean debris obstructing signals. Debris beneath the ocean can also damage naval vessels. These factors decrease real-time communication capabilities for submarines, negatively impacting mission effectiveness. The global geopolitical conflicts, terrorism activities, and comprehensive underwater studies necessitate ongoing advancements in naval technologies to ensure strategic stability. Hence, the above factors will impede the growth of the market 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.
Austal Ltd.: The company offers naval vessels such as high-speed support vessels, littoral combat ships, and patrol boats designed for rapid response and coastal defense operations.
BAE Systems Plc: The company offers naval vessels such as Type 45 destroyers, Queen Elizabeth-class aircraft carriers, and Astute-class submarines renowned for their technological advancements.
We also have detailed analyses of the market's competitive landscape and offer information on 20 market companies, including:
Technavio report provides 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 research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
The market is undergoing significant development efforts to modernize and expand its naval fleet. With negative impacts such as a reduction in production rates in the initial few years, countries like India and France are focusing on force structure expansion plans and qualitative technological edge. The market also sees advancements in unmanned vehicles and the development of next-generation vessels like the Next-Generation Logistics Ship (NGLS) and European patrol corvette (EPC). Noteworthy players include Korea Shipbuilding & Offshore Engineering and Hyundai Heavy Industries (HHI). The market is witnessing advancements driven by Naval Vessel Research and development efforts at the Shimonoseki shipyard. Global defense supply chains are evolving to meet the demand for modern warships, including those in the North American market.
Further, the market sees a trend towards distributed fleet architecture and the development of smaller ships for various naval forces, such as the Indian Navy with vessels like INS Vikramaditya and INS Vikrant, and the French Navy. Countries like China and the Philippines are also investing in their naval capabilities with programs like the Next-Generation Logistics Ship (NGLS) and Corvette Acquisition Program (CAP). The market is influenced by Aerospace & Defense Research and ongoing Defense Research efforts. Merchant ships and the modernization of the Chinese Naval fleet are key factors. Innovations like the Next-Generation Logistics Ship (NGLS) program are shaping the market, alongside initiatives like those of the Philippine Department of National Defense (DND).
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Market Scope |
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Report Coverage |
Details |
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Page number |
174 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 16.81% |
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Market Growth 2024-2028 |
USD 124.3 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
13.99 |
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Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
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Performing market contribution |
North America at 48% |
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Key countries |
US, China, Germany, Canada, and UK |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Abu Dhabi Ship Building PJSC, Austal Ltd., BAE Systems Plc, China Shipbuilding Trading Co. Ltd., Damen Shipyards Group, Fincantieri Spa, Fr. Lurssen Werft GmbH, General Dynamics Corp., Hanwha Corp., HD Hyundai Co. Ltd., Huntington Ingalls Industries Inc., Kalashnikov Concern JSC, Larsen and Toubro Ltd., Lockheed Martin Corp., Mitsubishi Heavy Industries Ltd., Naval Group, Navantia SA, PT PAL Indonesia, thyssenkrupp AG, and United Shipbuilding Corp. |
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Market dynamics |
Parent market growth analysis, Market Forecasting, 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 market forecast period. |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Technavio Analysis
3 Market Landscape
4 Market Sizing
5 Historic Market Size
6 Qualitative Analysis
7 Five Forces Analysis
8 Market Segmentation by Type
9 Market Segmentation by Application
10 Customer Landscape
11 Geographic Landscape
12 Drivers, Challenges, and Opportunity/Restraints
13 Competitive Landscape
14 Competitive Analysis
15 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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