Product Synopsis This report is the result of SDI's extensive market and company research covering the US defense industry, and provides detailed analysis of both historic and forecast defense industry values including key growth stimulators, analysis of the leading companies in the industry, and key news. Introduction and Landscape Why was the report written? The Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018 offers the reader an insight into the market opportunities and entry strategies adopted by foreign original equipment manufacturers (OEMs) to gain market share in the US defense industry. What is the current market landscape and what is changing? The US is the world's leading defense market, with a defense budget of US$613.9 billion in 2013, and is expected to remain at the top defense spenders table over the forecast period. Although funding for overseas operations is estimated to decrease, the country's base military expenditure is expected to increase at a CAGR of 1.93% over the forecast period. Plans for acquisition of advanced defense equipment coupled with replacement of old and obsolete equipment are projected to drive the country's capital expenditure presenting growth opportunities for the defense equipment and technology suppliers, despite looming threat of budget cuts and sequestration. View Detail Report With TOC At : http://www.researchmoz.us/future-of-the-us-defense-industry-market-attractiveness-competitive-landscape-and-forecasts-to-2018-report.html

1. Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018
Product Synopsis
This report is the result of SDI's extensive market and company research covering the US defense industry,
and provides detailed analysis of both historic and forecast defense industry values including key growth
stimulators, analysis of the leading companies in the industry, and key news.
Introduction and Landscape
Why was the report written?
The Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to
2018 offers the reader an insight into the market opportunities and entry strategies adopted by foreign original
equipment manufacturers (OEMs) to gain market share in the US defense industry.
What is the current market landscape and what is changing?
The US is the world's leading defense market, with a defense budget of US$613.9 billion in 2013, and is
expected to remain at the top defense spenders table over the forecast period. Although funding for overseas
operations is estimated to decrease, the country's base military expenditure is expected to increase at a CAGR
of 1.93% over the forecast period. Plans for acquisition of advanced defense equipment coupled with
replacement of old and obsolete equipment are projected to drive the country's capital expenditure presenting
growth opportunities for the defense equipment and technology suppliers, despite looming threat of budget
cuts and sequestration. Sequestration will not terminate or affect the existing contracts, but only affect the
DoD's future contracts and the number of equipment to be procured under these contracts. Still, the US market
is estimated to retain its attractiveness for foreign defense companies and new entrants, which can enter the
market through joint development or strategic alliance with or acquisition of domestic players. The US
government's encouragement of foreign direct investment (FDI) in defense sector will also help foreign
companies in entering the market. The homeland security market of the US is expected to be driven by
missions such as preventing terrorism and enhance security; securing and manage borders; enforcing and
administering immigration laws; safeguarding and securing cyberspace; as well as ensuring disaster resilience.
During the forecast period, the US is expected to invest in homeland security products such as surveillance
equipment, and cutters and patrol vessels, and the budget of the US is expected to increase from US$60.7
billion in 2013 to US$65.3 billion in 2018, registering a CAGR growth of 2.15%.
What are the key drivers behind recent market changes?
Rebalancing of Asia- Pacific, turbulent Middle East, modernization and replacement of obsolete equipment,
are expected to drive defense spending
What makes this report unique and essential to read?
The Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to
2018 provides detailed analysis of the current industry size and growth expectations from 2014 to 2018,
including highlights of key growth stimulators. It also benchmarks the industry against key global markets and
provides a detailed understanding of emerging opportunities in specific areas.
Key Features and Benefits
The report provides detailed analysis of the current industry size and growth expectations from 2014 to
2018, including highlights of key growth stimulators, and also benchmarks the industry against key global
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

2. markets and provides a detailed understanding of emerging opportunities in specific areas. The report includes
trend analysis of imports and exports, together with their implications and impact on the US defense industry.
The report covers five forces analysis to identify various power centers in the industry and how these are
expected to develop in the future. The report allows readers to identify possible ways to enter the market,
together with detailed descriptions of how existing companies have entered the market, including key
contracts, alliances, and strategic initiatives. The report helps the reader to understand the competitive
landscape of the defense industry in The US. It provides an overview of key defense companies, both domestic
and foreign, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.
Key Market Issues
2011 Budget Control Act (BCA) has set a cap on total national defense budget funding, starting with
US$546 billion in 2013 and reduced it by US$54.3 billion each subsequent year. BCA necessitated the US
Department of Defense (DoD) to take-up US$487 billion of reductions in its expenditure over the period of 10
years. Sequestration, if allowed to go into effect, would alter virtually every aspect of DoD's planning. It
would force a uniform reduction in budget authority of approximately 10.3% across all accounts other than
military personnel. Sequestration does not affect defense budget funding that has already been obliged, but
only affects DoD's ability to award new contracts and exercise option on existing contracts. While
sequestration will reduce funding for nearly all acquisition programs across DoD, it will not directly terminate
programs. An across-the-board reduction will force DoD to renegotiate many contracts to be able to buy in
smaller quantities since less funding will be available. The US must modernize its aging fleet of equipment,
such as fighter aircraft, helicopters, land defense systems, and maritime equipment; however, the rising unit
cost of defense systems poses a challenge to procurement funding. The cost of military hardware is increasing
due to technological advancements and a shortage of skilled labor in the design, engineering, and
manufacturing sectors, coupled with the rising cost of input materials such as metal. In addition, the per-unit
overhead costs at production facilities increased due to a reduction in the number of units manufactured; for
example, in the shipbuilding industry the cost of constructing ships has been increasing 1.4% per year faster
than the price of final goods and services in the US economy. The US government has reduced the amount of
military hardware to be procured, resulting in a reduction in the number of units to be produced, a loss in
profits, and increasing unemployment in such sectors. With the US aiming to reduce the country's defense
expenditure by US$60 billion during 2013-2018, and rising personnel and health costs, the country's capital
expenditure on defense is anticipated to decrease. Furthermore, the government encourages companies
throughout the defense market to increase the efficiency of the organizations and sell unprofitable units. In
addition, reverse engineering by countries like China and Iran will enable the defense companies of these
countries to offer defense equipment at lower price, posing a challenge to the domestic defense companies of
the US. According to SDI's Defense Industry Business Outlook 2013-2014 survey, 43% of respondents from
the North American region agree that the reverse engineering from countries is the biggest concern for the
defense industry in the coming five years, and as a result, defense companies will be compelled to take greater
risks and accept lower profits on the limited number of available government contracts. Due to a combination
of the above factors, unemployment is expected to increase, negotiations with suppliers and customers will
become tense, and efforts to reduce expenses will increase across the board. Companies such as Lockheed
Martin and Northrop Grumman have already taken strategic steps, such as the sale of unprofitable units and
redundancy packages for senior managers, in order to reduce executive payrolls.
Key Highlights
Rebalancing of Asia-Pacific: Post decade-long wars in Afghanistan and Iraq the US shifted its defense
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

3. strategic focus towards the region with potential to pose threat to its economy and superpower status. Growing
might of Chinese military and its assertiveness in regional disputes in the recent years have grabbed the
attention of the US. The US considers China to possess the capability of affecting its superpower status both
economically and militarily. Chinese investments in fifth generation aircraft, cyber warfare, anti-aircraft and
anti-ship weaponry, aircraft carriers, submarines, and ballistic missiles pose a potential threat to US power
projection capabilities in the Pacific. Another potential threat for the US is North Korea, which is perceived to
be trying to achieve nuclear capability. The country also believes that North Korea is actively pursuing the
development of thermonuclear weapons such as hydrogen bombs in which plutonium and uranium are
combined for a higher energy yield. Following the 9/11 attacks, the US reorganized and integrated its federal
agencies and created the Department of Homeland Security (DHS) for the purpose of building a strengthened
homeland security enterprise and to be equipped to counter a range of threats. The DHS's expenditure is
expected to driven by the mission areas such as preventing terrorism and enhancing security, securing and
managing its borders, and safeguarding and securing Cyberspace. Preventing Terrorism and enhancing
security: DHS's top priority mission area is preventing terrorism on its land and enhancing the security. DHS's
counterterrorism responsibilities focus on preventing the unauthorized acquisition, importation, movement, or
use of chemical, biological, radiological, and nuclear materials and capabilities within the United States; and
reducing the vulnerability of critical U.S. infrastructure and key resources, essential leadership, and major
events to terrorist attacks and other hazards. Recent Boston Marathon bombings have re-imposed the need of
counter terrorism measures and the country is expected increase fund allocations for this purpose. The US has
a highly developed defense industry that is capable of fulfilling the majority of domestic military
requirements, and the nation is also the largest global exporter of defense equipment due to its highly
advanced defense industrial base. Despite this, the US has become increasingly open to importing arms goods
from foreign defense equipment suppliers in the UK and Canada, and consequently, arms imports registered a
steady increase during the review period; the majority of imports consist of subsystems and components for
aircraft and armored vehicles. Although global military expenditure registered a decline in 2009 due to the
global economic slowdown, US defense exports continued to grow that year; the largest consumers of US
defense goods during 2008-2012 were South Korea, Australia, and the UAE. While the country exports all
types of defense equipment, the majority consists of fighter aircraft, missile defense systems, armored
vehicles, engines, and sensors.
table Of Content
1 Introduction
1.1. What Is This Report Bout?
1.2. Definitions
1.3. Summary Methodology
1.4. Sdi Terrorism Index
1.5. About Strategic Defence Intelligence
2 Executive Summary
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

4. 3 Market Attractiveness And Emerging Opportunities
3.1. Defense Market Size Historical And Forecast
3.1.1. Us Defense Expenditure Estimated To Increase At A Cagr Of 1.93% Over The Forecast Period
3.1.2. Rebalancing Of Asia- Pacific, Turbulent Middle East, Modernization And Replacement Of Obsolete
Equipment, Are Expected To Drive Defense Spending
3.1.3. Defense Expenditure As A Percentage Of Gdp Expected To Drop Over The Forecast Period
3.1.4. Per Capita Defense Spending Forecast To Decline Over The Forecast Period
3.2. Analysis Of Defense Budget Allocation
3.2.1. Total Dod Budget Forecasted To Decline At A Cagr Of -0.38%
3.2.2. Share Of Revenue Expenditure Expected To Increase Over The Forecast Period
3.2.3. Budget Allocation For Navy To Remain Dominant Over The Forecast Period
3.2.4. Revenue Expenditure Allocation For The Army Expected To Increase Over The Forecast Period
3.2.5. Naval Defense Budget Expected To Grow At A Cagr Of 2.18% Over Forecast Period
3.2.6. The Us Expected To Spend Us$765.1 Billion On Its Air Force Over The Forecast Period
3.2.7. Expenditure On The Defense-wide Category Of Armed Forces Projected To Grow At A Cagr Of 2.26%
Over The Forecast Period
3.3. Homeland Security Market Size And Forecast
3.3.1. The Us Homeland Security Expenditure To Reach Us$65.3 Billion By 2018
3.3.2. Preventing Terrorism, Securing And Managing Borders, And Safeguarding Cyberspace To Drive
Homeland Security Expenditure Over The Forecast Period
3.3.3. The Nation Is At “some Risk” Of Terrorism
3.3.4. The Us Has A Terrorism Index Score Of 0.02
3.4. Benchmarking With Key Global Markets
3.4.1. The Us Will Dominate Global Military Spending Over The Forecast Period
3.4.2. Us Defense Budget Is Much Higher Than Other Leading Spenders
3.4.3. Us Defense Expenditure As A Percentage Of Gdp Is The Third-highest In The World
3.4.4. Us Was Largest Global Arms Exporter During 2008-2012
3.4.5. The Us Emerged As Eighth-largest Global Arms Importer During 2008-2012
3.4.6. The Us Faces Some Threat From Foreign Terrorist Organizations
3.5. Market Opportunities: Key Trends And Growth Stimulators
3.5.1. Fighters And Multi-role Aircraft
3.5.2. Force Management
3.5.3. Networking/information Management:
3.5.4. Cyber Security
3.5.5. Software Infrastructure
3.5.6. Space Warfare Systems
3.5.7. Multi-role Aircraft Mro
3.5.8. Border Security
3.5.9. Maritime Security
4 Defense Procurement Market Dynamics
4.1. Import Market Dynamics
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

5. 4.1.1. Us Primarily Imports Defense Equipment To Build Strategic Relations
4.1.2. Defense Imports Grew At A Cagr Of 10.1% During 2008-2012
4.1.3. The Uk Supplies The Majority Of Us Defense Imports
4.1.4. Aircraft Account For Majority Of Arms Imports
4.2. Export Market Dynamics
4.2.1. Us Arms Exports Are Driven By Political And Economic Factors
4.2.2. Arms Exports Expected To Increase In The Period 2013-2018
4.2.3. Us Defense Exports To Increase During The Forecast Period
4.2.4. Aircraft Are The Most Exported Defense Good
4.2.5. The Us Maintains Controlled Defense Export Policy
5 Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining Power Of Supplier: Medium To Low
5.1.2. Bargaining Power Of Buyer: High
5.1.3. Barrier To Entry: Medium
5.1.4. Intensity Of Rivalry: Low To High
5.1.5. Threat Of Substitution: Low To High
6 Market Entry Strategy
6.1. Market Regulation
6.1.1. The Us Defense Industry Is Open To Fdi
6.1.2. No Offset Policy Exists In The Us
6.1.3. Us Arms Trade Is Heavily Regulated
6.2. Market Entry Route
6.2.1. Foreign Oems Enter The Market Through The Acquisition Of Domestic Defense Companies
6.2.2. Joint Product Development Programs, An Attractive Market Entry Route
6.2.3. Formation Of Partnerships With Domestic Defense Firms Provide Good Market Entry Opportunities
6.2.4. Direct Sale Of Defense Equipment Provides Foreign Oems With An Opportunity To Enter The Market
6.3. Key Challenges
6.3.1. Sequestration And Budget Cuts
6.3.2. Decreasing Economies Of Scale And Defense Inflation
6.3.3. Declining Profit Margins Deter Growth Of Domestic Defense Companies
7 Competitive Landscape And Strategic Insights
7.1. Competitive Landscape Overview
7.2. Domestic Public Companies
7.2.1. Lockheed Martin Corp.: Overview
7.2.2. Lockheed Martin Corp.: Products And Services
7.2.3. Lockheed Martin Corp.: Recent Announcements And Strategic Initiatives
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

6. 7.2.4. Lockheed Martin Corp.: Alliances
7.2.5. Lockheed Martin Corp.: Recent Contract Wins
7.2.6. Lockheed Martin Corp.: Financial Analysis
7.2.7. Raytheon: Overview
7.2.8. Raytheon: Products And Services
7.2.9. Raytheon: Recent Announcements And Strategic Initiatives
7.2.10. Raytheon: Alliances
7.2.11. Raytheon: Recent Contract Wins
7.2.12. Raytheon: Financial Analysis
7.2.13. General Dynamics: Overview
7.2.14. General Dynamics: Products And Services
7.2.15. General Dynamics: Recent Announcements And Strategic Initiatives
7.2.16. General Dynamics: Alliances
7.2.17. General Dynamics: Recent Contract Wins
7.2.18. General Dynamics: Financial Analysis
7.2.19. Boeing: Overview
7.2.20. Boeing: Products And Services
7.2.21. Boeing: Recent Announcements And Strategic Initiatives
7.2.22. Boeing: Alliances
7.2.23. Boeing: Recent Contract Wins
7.2.24. Boeing: Financial Analysis
7.2.25. L-3 Communications Corp.: Overview
7.2.26. L-3 Communications Corp.: Products And Services
7.2.27. L-3 Communications Corp.: Recent Announcements And Strategic Initiatives
7.2.28. L-3 Communications Corp.: Alliances
7.2.29. L-3 Communications Corp.: Recent Contract Wins
7.2.30. L-3 Communications Corp.: Financial Analysis
7.2.31. Northrop Grumman Corp.: Overview
7.2.32. Northrop Grumman Corp.: Products And Services
7.2.33. Northrop Grumman Corp.: Recent Contracts And Strategic Initiatives
7.2.34. Northrop Grumman Corporation: Alliances
7.2.35. Northrop Grumman Corp.: Recent Contract Wins
7.2.36. Northrop Grumman Corp.: Financial Analysis
7.2.37. Science Application International Corp. (saic): Overview
7.2.38. Science Application International Corp. (saic): Products And Services
7.2.39. Science Application International Corp. (saic): Recent Contracts And Strategic Initiatives
7.2.40. Science Application International Corp. (saic): Alliances
7.2.41. Science Application International Corp. (saic): Recent Contract Wins
7.2.42. Science Application International Corp. (saic): Financial Analysis
7.2.43. Honeywell International Inc.: Overview
7.2.44. Honeywell International Inc.: Products And Services
7.2.45. Honeywell International Inc.: Recent Announcements And Strategic Initiatives
7.2.46. Honeywell International Inc.: Alliances
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

7. 7.2.47. Honeywell International Inc.: Recent Contract Wins
7.2.48. Honeywell International Inc.: Financial Analysis
7.3. Domestic Private Companies
7.3.1. Sikorsky Aircraft: Overview
7.3.2. Sikorsky Aircraft: Products And Services
7.3.3. Sikorsky Aircraft: Recent Announcements And Strategic Initiatives
7.3.4. Sikorsky Aircraft: Alliances
7.3.5. Sikorsky Aircraft: Recent Contract Wins
7.3.6. General Electric Aviation: Overview
7.3.7. General Electric Aviation: Products And Services
7.3.8. General Electric Aviation: Recent Contracts And Strategic Initiatives
7.3.9. General Electric Aviation: Alliances
7.3.10. General Electric Aviation: Recent Contract Wins
7.3.11. Bell Helicopter Textron, Inc.: Overview
7.3.12. Bell Helicopter Textron, Inc.: Products And Services
7.3.13. Bell Helicopter Textron, Inc.: Recent Announcements And Strategic Initiatives
7.3.14. Bell Helicopter Textron, Inc.: Alliances
7.3.15. Bell Helicopter Textron, Inc.: Recent Contract Wins
7.3.16. Textron Marine And Land Systems: Overview
7.3.17. Textron Marine And Land Systems: Products And Services
7.3.18. Textron Marine And Land Systems: Recent Announcements And Strategic Initiatives
7.3.19. Textron Marine And Land Systems: Alliances
7.3.20. Textron Marine And Land Systems: Recent Contract Wins
8 Business Environment And Country Risk
8.1. Demographics And Social Statistics
8.1.1. Total Rural Population
8.1.2. Total Urban Population
8.1.3. Number Of Households
8.2. Economic Performance
8.2.1. Gdp Per Capita
8.2.2. Gdp, Current Prices
8.2.3. Consumer Price Index
8.2.4. Wholesale Price Index
8.2.5. Local Currency Unit Per Euro
8.2.6. Lending Rate
8.2.7. Real Interest Rate
8.2.8. Market Capitalization Of Listed Companies
8.2.9. Market Capitalization Of Listed Companies (% Of Gdp)
8.2.10. Government Cash Surplus/deficit
8.2.11. Government Cash Surplus/deficit As % Of Gdp
8.2.12. Central Government Debt
Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018

8. 8.2.13. Central Government Debt As % Of Gdp
8.2.14. Goods Exports As % Of Gdp
8.2.15. Goods Imports As % Of Gdp
8.2.16. Goods Trade Surplus/deficit As % Of Gdp
8.2.17. Service Imports As % Of Gdp
8.2.18. Service Exports As % Of Gdp
8.2.19. Service Trade Surplus/deficit As % Of Gdp
8.2.20. Foreign Direct Investment
8.2.21. Net Foreign Direct Investment As % Of Gdp
8.2.22. International Reserves, Including Gold
8.3. Energy And Utilities
8.3.1. Conventional Thermal Electricity Net Generation
8.3.2. Hydroelectricity Net Generation
8.3.3. Nuclear Electricity Net Generation
8.3.4. Conventional Thermal Electricity Installed Capacity
8.3.5. Electricity Exports
8.3.6. Electricity Imports
8.3.7. Proved Natural Gas Reserves
8.3.8. Petroleum Consumption
8.3.9. Crude Oil Proved Reserves
8.3.10. Total Non-hydro Renewable Electricity Net Generation
8.4. Infrastructure
8.4.1. Rail Lines
8.4.2. Air Transport, Freight
8.4.3. Overall Construction
8.5. Minerals
8.5.1. Mining, Manufacturing, Utilities Output
8.6. Technology
8.6.1. Research And Development Expenditure
8.6.2. Patents Granted
8.7. Telecommunication
8.7.1. Telephone Lines
8.7.2. Telephone Lines Penetration Rate
9 Appendix
9.1. About Sdi
9.2. Disclaimer
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Future of the US Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018