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The vetronics market size is forecast to increase by USD 1.12 billion, at a CAGR of 4.5% between 2024 and 2028. The vetronics market is undergoing significant modernization, with a focus on upgrading existing military vehicles with advanced embedded systems. This trend is driven by the increasing adoption of network-centric warfare, which necessitates real-time communication and data sharing between military platforms. The integration of these systems enables enhanced situational awareness, improved operational efficiency, and increased battlefield effectiveness. As a result, defense organizations are investing in vetronics solutions to stay competitive and better respond to evolving threat landscapes. This shift towards modern vetronics is a critical component of military modernization efforts, enabling more effective and agile military operations.
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The evolution of main battle tanks and light armored vehicles has been integral to modern military strategies, enhancing defense expenditure efficiency and bolstering ground vehicles capabilities. As aging fleets are upgraded, advancements in navigation and power systems ensure enhanced mobility and self-protection. Terrestrial assets benefit from robust communications systems and secure communications systems, facilitating inter-vehicle communication and surveillance capabilities crucial for command and vehicle health management. Innovations in digital hub integration and automotive electronic technologies enable autonomous driving and sophisticated sensors, reinforcing hardware and software interfaces across battle tanks and light protected vehicles.
Moreover, these technologies not only streamline line fit processes but also support military units with advanced battlefield capabilities. The continuous evolution of amphibious armored vehicles ensures versatility in various terrains, exemplifying the integration of cutting-edge military technology to meet the demands of modern warfare. The development of a next-generation main battle tank, light armored vehicle, and amphibious armored vehicle hinges on advanced mobility systems, robust inter-vehicle communication, effective self-protection, and seamless software interface.
Key Market Driver
One of the key factors driving the global vetronics market growth is the modernization of existing military vehicles to provide military forces with better survivability, easy navigation, and higher firepower. Military modernization programs include upgrades in the weapons systems, networking capabilities, and command and control (C2) systems. The upgrades automatically include those for dedicated vetronics subsystems. In addition, defense agencies are upgrading the vetronics systems of their military vehicles to refurbish their fleets.
Moreover, this will help extend the service life of the vehicles and reduce service costs. For instance, in June 2021, Oshkosh Defense, a subsidiary of Oshkosh Corp., was selected by the US army to modernize the Stryker Double V Hull Infantry Carrier Vehicle (ICVVA1) for USD 942.9 million. Such factors will drive the market growth during the forecast period.
Key Market Trend
Development of advanced vetronics for next-generation military vehicles, to provide an active protection system to identify and destroy threats, is one of the key vetronics market trends that is expected to impact the industry positively in the forecast period. Laser technology for weapons is emerging as a new alternative, and military vehicles are being designed to accommodate next-generation laser weapon systems. In the future, military vehicles will require all-around protection against aerial threats, surrounding threats from ground weapons, and undercarriage threats from mines or improvised explosive devices.
Moreover, such factors will lead to the development of next-generation military vehicles that will use alternative energy sources, directed-energy weapons, advanced-composite armor, and active protection systems. This will generate the demand for advanced vetronics systems in the coming years.
Key Market Challenge
One of the key challenges to the global vetronics market growth is cybersecurity concerns. The security threats that are carried through the vehicle's controller area network (CAN) bus, range from remotely shutting down an engine to causing the brakes of a vehicle to malfunction. Thus, to protect vetronics systems from electronic attacks, military forces are focusing on fortifying the network security of a vehicle, which encompasses both physical and logical security.
However, redundancy with respect to vetronics systems implies the incorporation of more than one similar electronic component in a vehicle's subsystems, which the master system controls. In addition, logical security relates to the protection of the ISR data that is collected and processed by the vetronics systems against theft, tampering, and deletion. Such concerns may limit the market growth during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
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.
BAE Systems Plc - The company offers vetronics, which have active protection systems and electro-optical commander sights.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The military segments is estimated to witness significant growth during the forecast period. The mission requirements for the military witness constant evolution. Innovative intelligence, surveillance, reconnaissance (ISR) technologies, high-definition (HD) video streaming, high-bandwidth networking hardware, and advanced threat detection sensors are some of the new advanced technologies that armed forces across the world are integrating into their ground vehicles. This gives rise to the need for advanced vetronics systems that can handle such new hardware as well as software upgrades. The high data-exchange rates that are provided by using open commercial off-the-shelf (COTS) architectures lead to complex signal-integrity issues at all levels of the system, including processor chips.
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The military segments accounted for USD 3.49 billion in 2018 and showed a gradual increase during the forecast period. The evolution of weapons and the rise in threats to military vehicles are escalating the need for advanced threat detection and mitigation systems. Traditional threat detection sensors can identify projectiles and mines easily. However, they are ineffective in detecting vehicles and weapons, such as electric vehicles, improvised explosive devices (IEDs), and laser weapons, which have low heat and acoustic signatures. Advanced electronic sensor systems are required to enable the detection of threats posed by such evolving weapon systems. The emergence of unmanned ground vehicles (UGVs) is increasing the scope of ISR operations. A wide range of payload systems, such as imaging systems, night vision systems, and electronic signal jamming systems, are being developed to be integrated with UGVs. Many such systems are used simultaneously to generate enhanced data from ISR activities, which requires the seamless integration of the systems. These factors will have a positive impact on the growth of the global vetronics market during the forecast period.
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North America is estimated to contribute 45% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market growth in North America is predominantly supported by the robust military force, particularly in the US. Currently, the US is the largest market for vetronics in North America. The major integrators of vetronics, such as Curtiss-Wright Corp., and General Dynamics Corp., play a crucial role in the development of the market in focus in North America. These market vendors also cater to the Asian and European markets to increase their market shares.
Moreover, military forces in the region are realizing the need for advanced vetronics systems to enhance the operational efficiency of their vehicles. Defense agencies are upgrading the vetronics systems in their military vehicles to modernize their fleets. This will help extend the service life of military vehicles and reduce service and repair costs. The major reason for the growth of the regional market is the increase in growing spending by governments to develop their military and defense units. Countries such as the US, Canada, and Mexico, have increased their military spending in recent years.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion " for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
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The defense sector continues to advance with innovations in main battle tanks, light armored vehicles, and amphibious armored vehicles, crucial for modern ground operations and border security. As aging fleets are upgraded, new armored personnel carriers and infantry fighting vehicles integrate advanced electronic systems and vetronics architecture for enhanced operational capacities and self-protection. Advanced communication systems and fusion technologies enable joint operations and active intelligence collection, essential for asymmetric warfare approaches.
Moreover, the development of optionally manned fighting vehicles and next-generation vehicles showcases the evolution towards hybrid defense technologies and agility in combat scenarios. Cyber attacks drive innovations in cybersecurity measures like cloud computing and secure communications systems, safeguarding sensor and optronics and weapon control systems from threats. Exhibitions and panel discussions highlight the integration of unmanned vehicles and HD video calling for surveillance and reconnaissance missions, shaping the future of military and defense services in a dynamic global landscape.
Market Scope |
|
Report Coverage |
Details |
Page number |
143 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.5% |
Market growth 2024-2028 |
USD 1.12 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
4.23 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 45% |
Key countries |
US, Russia, China, France, and India |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Adecco Group AG, AMETEK Inc., BAE Systems Plc, Curtiss Wright Corp, Elbit Systems Ltd., General Dynamics Corp., Kongsberg Gruppen ASA, Krauss Maffei Wegmann GmbH and Co. KG, L3Harris Technologies Inc., Leonardo Spa, Lockheed Martin Corp., Moog Inc., Oshkosh Corp., Rheinmetall AG, RTX Corp., Saab AB, TE Connectivity Ltd., Thales Group, and Ultra Electronics Holdings Plc |
Market dynamics |
Parent market analysis, Market forecasting growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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. |
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Opportunity/Restraints
10 Competitive Landscape
11 Competitive Analysis
12 Appendix
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