Spanish defense expenditure expected to be US$12.1 billion by 2017 & Homeland security market to grow at a CAGR of 3.4% to 2017
This report is the result of ICD Research / Strategic Defence Intelligence’s extensive market and company research covering the Spanish defense industry. It 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 Spanish Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2017 offers the reader insights into the market opportunities and entry strategies adopted by foreign original equipment manufacturers (OEMs) to gain market share in the Spanish defense industry.
What is the current market landscape and what is changing?
The Spanish Ministry of Defense is expected to spend US$56.68 billion on its armed forces during the forecast period. Defense spending, which grew at a CAGR of -6.7% during the review period, is expected to record a CAGR of 3.2%, largely due to the financial constraints caused by the global financial crisis. Furthermore, defense expenditure as a percentage of the nation’s GDP will increase marginally from an average of 0.73% during the review period to 0.75% during the forecast period.
What are the key drivers behind recent market changes?
Factors such as the strained relationship with Morocco, security threats by armed Basque separatist group ETA, and expenses incurred on international missions will maintain military spending during the forecast period and Spain is expected to spend US$56.68 billion on defense. In addition, maritime security threats and drug trafficking will drive homeland security spending. To safeguard its coastline, Spain is anticipated to procure access control systems, upgrade its CCTV systems, and integrate its access control systems across multiple locations and maritime security systems.
What makes this report unique and essential to read?
The Spanish Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2017 provides detailed analysis of the current industry size and growth expectations from 2013 to 2017, 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.
Published: July 2012 No. of Pages: 158 Price: US $ 1250
Key Features and Benefits
Market Opportunity and Attractiveness
The report provides detailed analysis of the current industry size and growth expectations from 2013 to 2017, 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.
Procurement Dynamics
The report includes trend analysis of imports and exports, together with their implications and impact on the Spanish defense industry.
Industry Structure
The report covers five forces analysis to identify various power centers in the industry and how these are forecast to develop in the future.
Market Entry Strategy
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.
Competitive Landscape and Strategic Insights
The report helps the reader to understand the competitive landscape of the defense industry in Spain. It provides an overview of key defense companies, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.
Key Market Issues
Defense budget cuts discourage investors from entering the industry
In 2012, the Spanish defense budget decreased by 4.9% from that of 2011 to US$9.48 billion. While Spanish defense expenditure recorded negative growth of -6.7% during the review period, it is expected to record a CAGR of 3.2% during the forecast period. Furthermore, the share of capital expenditure in the total defense budget is also expected to decrease from an average of 18.7% during the review period to 14.9% during the forecast period. As this is expected to reduce market opportunities, investments are expected to fall, which will hinder the growth of the Spanish defense industry.
Project delays is a key challenge in defense industry growth
The growth of the Spanish defense industry is additionally hindered by the project delays associated with the global financial crisis, which lead to project cancellations and rising costs. In particular, the implementation of a European defense industry has caused several project delays, as often member countries are unable to agree unanimously over issues such as specifications.
Decrease in defense imports hinders industry growth
During 2007-2011, arms imports decreased at a CAGR of -7.6% which reflected the reduction in the Spanish defense budget. However, during the forecast period, the nation is expected to acquire armored vehicles and missile defense systems, as its domestic defense sector is underdeveloped in both of these categories.
Key Highlights
Spanish defense expenditure expected to be US$12.1 billion by 2017
In 2012, the Spanish defense budget valued US$9.48 billion and grew at a CAGR of -6.7% during the review period due to the budget cuts associated with the effects of the global economic crisis. However, the Spanish defense budget is expected to register a CAGR of 3.2% during the forecast period, to value US$12.08 billion in 2017. The defense budget avoided further cuts because of costly factors such as international missions, security threats and Spain’s strained relationship with Morocco.
Revenue expenditure to continue to account for the majority of defense expenditure
During the review period, Spain spent an average of 18.7% of its total defense expenditure on the acquisition of military hardware, or capital expenditure, whilst 81.3% was allocated for revenue expenditure. Although the share of capital expenditure in the total defense budget is expected to decrease to an average of 14.9% during the forecast period, the capital expenditure budget is forecast to grow at a CAGR of 1.8% to 2017.
Security threats will drive the demand for armored fighting vehicles
Persistent security threats from the Basque separatist group, ETA, and the increased risk of terrorism from international terrorist organizations such as Al-Qaeda have forced the nation to enhance the safety and mobility of Spanish troops. The nation’s armed forces operate the light multi-role vehicle (LMV) manufactured by Iveco and the RG-31 developed by BAE Systems, but the country is expected to procure 4×4 armored vehicles to support troops, along with 8×8 armored vehicles to replace the 6×6 vehicles in service.
Homeland security market to grow at a CAGR of 3.4% to 2017
In 2012, the Spanish homeland security market valued US$11.2 billion and decreased at a CAGR of -4.8% during the review period. Following this, the Spanish homeland security market is expected to record a CAGR of 3.4% during the forecast period to reach US$13.2 billion by 2017. Despite the global economic crisis, spending on homeland security is expected to increase during the forecast period because of a rise in internal security threats, such as the risk of terrorist attacks by ETA and Al-Qaeda, and a rise in the trade of illicit drugs within the country.
List of Tables
Table 1: Spanish Defense Expenditure, 2008-2012
Table 2: Spanish Defense Expenditure, 2013-2017
Table 3: Spanish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP, 2008-2012
Table 4: Spanish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP, 2013-2017
Table 5: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Table 6: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Table 7: Spanish Defense Budget Breakdown (%), 2008-2012
Table 8: Spanish Defense Budget Breakdown (%), 2013-2017
Table 9: Spanish Army Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Table 10: Spanish Army Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Table 11: Spanish Navy Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Table 12: Spanish Navy Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Table 13: Spanish Air Force Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Table 14: Spanish Air Force Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Table 15: Spanish Other Category Defense Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Table 16: Spanish Other Category Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Table 17: Spanish Homeland Security Budget (US$ billion), 2008-2012
Table 18: Spanish Homeland Security Budget (US$ billion), 2013-2017
Table 19: Benchmarking with Key Markets – 2007-2011 vs. 2012-2016
Table 20: SDI Terrorism Index
Table 21: Spanish Defense Offset Regulations
Table 22: Market Entry Strategies by Key Foreign Companies
Table 23: Thales- Product Focus
Table 24: Thales: Alliances
Table 25: Thales – Recent Contracts
Table 26: Iveco- Key Products and Services
Table 27: Iveco – Recent Contract Wins
Table 28: Navantia – Key Products and Services
Table 29: Navantia – Alliances
Table 30: Navantia – Recent Contract Wins
Table 31: Santa Barbara Sistemas – Key Products and Services
Table 32: Santa Barbara Sistemas – Alliances
Table 33: Santa Barbara Sistemas- Recent Contract Wins
Table 34: Aernnova Aerospace S.A. – Key Products and Services
Table 35: Aernnova Aerospace S.A. – Recent Contract Wins
Table 36: Aries Ingenieria Y Sistemas, S.A – Key Products and Services
Table 37: Indra Sistemas SA – Key Products and Services
Table 38: Indra Sistemas S.A. – Alliances
Table 39: Indra Sistemas S.A. – Recent Contract Wins
Table 40: Sociedad Anonima De Electrónica Submarina, S.A. – Key Products and Services
Table 41: Sociedad Anonima De Electrónica Submarina, S.A. – Alliances
Table 42: Sociedad Anonima De Electrónica Submarina, S.A. – Recent Contract Wins
Table 43: Parafly, S.A – Key Products and Services
Table 44: Tecnobit – Key Products and Services
Table 45: Tecnobit – Alliances
Table 46: – Recent Contract Wins
Table 47: Uro Vehiculos Especiales S.A. – Key Products and Services
Table 48: Uro Vehiculos Especiales S.A. – Recent Contract Wins
Table 49: Amper – Key Products and Services
Table 50: Amper – Alliances
Table 51: Amper – Recent Contract Wins
List of Figures
Figure 1: Spanish Defense Expenditure, 2008-2012
Figure 2: Spanish Defense Expenditure, 2013-2017
Figure 3: Spanish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP, 2008-2012
Figure 4: Spanish GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP, 2013-2017
Figure 5: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Figure 6: Spanish Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Figure 7: Spanish Defense Budget Breakdown (%), 2008-2012
Figure 8: Spanish Defense Budget Breakdown (%), 2013-2017
Figure 9: Spanish Army Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Figure 10: Spanish Army Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Figure 11: Spanish Navy Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Figure 12: Spanish Navy Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Figure 13: Spanish Air Force Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Figure 14: Spanish Air Force Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Figure 15: Spanish Other Category Defense Budget Split Between Capital and Revenue Expenditure (%), 2008-2012
Figure 16: Spanish Other Category Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2017
Figure 17: Spanish Homeland Security Budget (US$ billion), 2008-2012
Figure 18: Spanish Homeland Security Budget (US$ billion), 2013-2017
Figure 19: SDI Terrorism Heat Map, 2011
Figure 20: SDI Terrorism Index, 2011
Figure 21: Benchmarking with Key Markets – 2007-2011 vs. 2012-2016
Figure 22: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2011 and 2016
Figure 23: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2011
Figure 24: Spanish Defense Import Trend, 2007-2011 (TIV values)
Figure 25: Spanish Defense Imports by Country (%), 2007-2011
Figure 26: Spanish Defense Imports by Category (%), 2007-2011
Figure 27: Spanish Defense Exports by Value (US$ million), 2007-2011
Figure 28: Spanish Defense Exports by Country (%), 2007-2011
Figure 29: Spanish Defense Exports by Category (%), 2007-2011
Figure 30: Industry Dynamics – Porter’s Five Forces Analysis
Figure 31: Aernnova Aerospace S.A. – Revenue Trend Analysis (EUR Million), 2007-2010
Figure 32: Aernnova Aerospace S.A. – Profit Before Tax Trend Analysis (EUR Million), 2007-2010
Figure 33: Aernnova Aerospace S.A. – Net Profit Trend Analysis (EUR Million), 2007-2010
Figure 34: Tecnobit – Revenue Trend Analysis (EUR Million), 2007-2010
Figure 35: Tecnobit – Operating Profit Trend Analysis (EUR Million), 2007-2010
Figure 36: Tecnobit – Net Profit Trend Analysis (EUR Million), 2007-2010
Figure 37: Amper – Revenue Trend Analysis (EUR Million), 2007-2011
Figure 38: Amper – Profit Before Tax Trend Analysis (EUR Million), 2007-2011
Figure 39: Amper – Net Profit Trend Analysis (EUR Million), 2007-2011
Figure 40: Spanish Population – Female (In Millions), 2008-2017
Figure 41: Spanish Population – Male (In Millions), 2008-2017
Figure 42: Spanish Business Confidence index, 2003-2012
Figure 43: Spanish Construction Output, Current Prices, Local Currency (In Billions), 2001-2010
Figure 44: Spanish Construction Output, Current Prices, US Dollars (In Billions), 2001-2010
Figure 45: Spanish Current Account Balance as Percentage of GDP, 2008-2017
Figure 46: Spanish Exports of goods and services, current prices (US$ Billion), 2001- 2010
Figure 47: Spanish Exports of Services, Local Currency (Billion), 2003-2012
Figure 48: Spanish Fiscal Balance as a Percentage of GDP, 2001-2010
Figure 49: Spanish Foreign Direct Investment (US$ Billion), 2001-2010
Figure 50: Spanish GDP at Purchasing Power Parity (US$ Billion), 2006-2015
Figure 51: Spanish GDP at Constant Prices (Local Currency Billion), 2006-2015
Figure 52: Spanish GDP at Constant Prices (US$ Billion), 2006-2015
Figure 53: Spanish GDP at Current Prices (Local Currency Billion), 2006-2015
Figure 54: Spanish GDP at Current Prices (US$ Billion), 2006-2015
Figure 55: Spanish General Government Final Consumption Expenditure (US$ Billion), 2001-2010
Figure 56: Spanish Gross Fixed Capital Formation, Current Prices (US$ Billion), 2001-2010
Figure 57: Spanish Imports of goods and services (current US$ Billion), 2001-2010
Figure 58: Spanish Imports of services (Local Currency Billion), 2003-2012
Figure 59: Spanish Inflation, average consumer prices, 2008-2017
Figure 60: Spanish Manufacturing Output, Current Prices (Local Currency Billion), 2001-2010
Figure 61: Spanish Manufacturing Output, Current Prices (US$ Billion), 2001-2010
Figure 62: Spanish Market cap of Stock Exchange (US$ bn), 2001-2010
Figure 63: Spanish US$- Exchange Rate (EoP), 2002-2011
Figure 64: Spanish Wholesale Price Index, 2000-2009
Figure 65: Spanish Crude Oil Distillation Capacity (Thousand Barrels Per Cal Day), 2000-2009
Figure 66: Spanish Electricity Installed Capacity (Billion Kilowatt hours), 2001-2010
Figure 67: Spanish Electricity Imports (Billion Kilowatt hours), 2001-2010
Figure 68: Spanish Electricity Installed Capacity (Million Kilowatts), 2000-2009
Figure 69: Spanish Fossil Fuels Proved Natural Gas Reserves (Trillion Cubic Feet), 2002-2011
Figure 70: Spanish Fossil Fuels Proved Oil Reserves (Billion Barrels), 2002-2011
Figure 71: Spanish Hydroelectricity Installed Capacity (Million Kilowatts), 2000-2009
Figure 72: Spanish Natural Gas Consumption (Billion Cubic Feet), 2001-2010
Figure 73: Spanish Natural Gas Imports (Billion Cubic Feet), 2001-2010
Figure 74: Spanish Natural Gas Production (Billion Cubic Feet), 2001-2010
Figure 75: Spanish Net Conventional Thermal Electricity Generation (Billion Kilowatt hours), 2001-2010
Figure 76: Spanish Net Geothermal, Solar, Wind, and Wood Electric Power Generation (Billion Kilowatt hours), 2001-2010
Figure 77: Spanish Net Hydroelectric Power Generation (Billion Kilowatt hours), 2001-2010
Figure 78: Spanish Net Hydroelectric Power Generation (Billion Kilowatt hours), 2001-2010
Figure 79: Spanish Petroleum Consumption (Thousand Barrels Per Day), 2002-2011
Figure 80: Spanish Petroleum Production (Thousand Barrels Per Day), 2002-2011
Figure 81: Spanish People Employed in R and D (Number of researchers per million people), 2000-2009
Figure 82: Spanish Coal Consumption (Thousand Short Tons), 2001-2010
Figure 83: Spanish Coal Production (Thousand Short Tons), 2001-2010
Figure 84: Spanish Political Stability Index, 2002-2010
Figure 85: Spanish Transparency Index, 2002-2011
Figure 86: Spanish Fixed Broadband Internet Subscribers (Thousands), 2001-2010
Figure 87: Gross Domestic Expenditure on Research and Development as % of GDP, 2000-2009
Figure 88: Investment in Telecommunication, 2000-2009
Figure 89: Patents Granted, 2002-2011
Figure 90: Software Patents, 2003-2011
Figure 91: Fixed line calling cost local, 2001-2010
Figure 92: Fixed Line Calling Cost National, 2001-2010
