The European military helicopter market is set to dwindle in size
over the next ten years, but will still remain relatively large, and
is valued at nearly US$26 billion between 2006 and 2015. According to
a Frost & Sullivan report published this week, the market is currently
at its peak, with major programs including NH90, Tiger and EH101 in
production. With the completion of these projects, the market will
return to a more 'normal' level as the decade progresses.
Despite this reduction in size, the military helicopter market will be
relatively healthy due to a number of new requirements, particularly
in the naval market. These positive trends will be reinforced by the
need to replace large numbers of surviving airframes dating from the
1960s and 1970s.
Frost & Sullivan find that the European Military Helicopter Market
will earn revenues of US$ 4.40 billion in 2006 and estimate that this
will fall to US$1.5 billion in 2015. "The European military helicopter
market will be determined by the demands of operations other than war
(OOTW) for the next ten years," observes Frost & Sullivan
Analyst Graham Cushway. "This generally means that they require a need
for greater adaptability in terms of mission, and large carrying
capacities. Subsidiary military helicopter markets, such as naval
helicopters and attack helicopters will also be boosted by these
OOTW are characterized by small numbers of troops being moved rapidly
around large areas to deal with larger numbers of insurgents.
Helicopters are usually the best way to achieve this, being faster
moving than ground vehicles and avoiding the hazards posed by
improvised explosive devices (IEDs).
At the same time, OOTW pose new problems in terms of military
helicopter design, as they need to be reconfigurable for roles such as
humanitarian aid and reconstruction, which require greater carrying
capacities than simple troop transport aircraft.
A major restraint in the market is that military budgets are
shrinking, particularly in terms of maintenance and ground staff. This
means that new military helicopter designs have to allow for a higher
level of maintainability and ease of repair than would previously have
been the case.
Market participants need to educate end users and develop solutions
that can bridge gaps in customer's communication needs while meeting
the growth requirements of an enterprise. By fulfilling these consumer
requirements, participants can expect steady demand in the future. The
deregulation of markets and the privatization of incumbent carriers
combined with the availability of feature-rich hosted IP telephony
platforms will also support revenue growth in this market.
Moreover, in the current helicopter market, airframes are expected to
greatly outlast mission systems through upgrades. This means that
modern military helicopters might last 40 years, and less platforms
need be purchased as a result.
"An approach to airframe design which favors ease of upgrade by the
incorporation of numerous commercial off-the-shelf (COTS) products
into mission systems will encourage sales," advises Mr. Cushway. "A
priority in terms of military budget is to reduce the maintenance and
logistic footprint for their forces, which means that helicopters need
to be easy to maintain, with simpler models such as the NH90 enjoying
a significant market advantage over the more complex V-22 and EH101."