Market Trends of Europe Medium And Large Caliber Ammunition Industry
Large Caliber Ammunition is Expected to Dominate the Market
Europe has a robust and technologically advanced defense market driven by various factors, including geopolitical concerns, modernization efforts, and defense budget allocations. The defense budgets of European countries play a crucial role in shaping the military helicopter market. Despite economic challenges, defense spending has remained a priority for many European nations due to rising security concerns. In 2022, Europe spent USD 480 billion on its military, an increase of 13% over 2021. By the end of March 2022, numerous European NATO member nations announced plans to increase military expenditures in reaction to the Russian invasion of Ukraine in February 2022, aiming to meet or exceed the NATO spending target of 2% of GDP or higher.
Large ammunition weapons are cost-effective over costly missiles and rockets used for ground attack operations. These factors are driving the demand for large-caliber ammunition in the region. For instance, in June 2023, the Norwegian Defense Materiel Agency (NDMA) awarded a contract to Nammo AS, a Norwegian/Finnish aerospace and defense group, to supply 155mm IM HE-ER mortar shells, with a range of some 40 kilometers to enhance the capabilities of the Norwegian Armed Forces.
Similarly, in January 2022, Germany鈥檚 federal armed forces announced its plans to upgrade its 120mm mortar systems and respective ammunition and awarded a contract for USD 30.62 million to Rheinmetall AG. The upgrade will include firing new-generation shells and adding obturation rings to the mortar tubes. It will be equipped with a modern propulsion system and highly intensive explosives, with an extended range of 4.9 miles and high precision. These developments are driving the segment market during the forecast period.
United Kingdom To Dominate Market Share During the Forecast Period
To confront potential threats, the UK intends to upgrade its armed forces. According to the recently released Defense Equipment Plan for 2021 to 2031, the country aims to spend USD 321 billion on the purchase and support of equipment. On this note, the UK's military budget 2023 was USD 69.29 billion.
The UK has around 192,000 active military personnel and 83,000 reserve military personnel, bringing the total military strength of the country to about 275,000. These forces are responsible for the defense of the UK, its overseas territories, and the Crown dependencies. The UK has provided millions of rounds of ammunition and advanced weapons and equipment to the Ukrainian armed forces to support their fight against Russia鈥檚 invasion. The UK government also confirmed the increase in the UK鈥檚 155mm production capacity ahead of the NATO Summit in Vilnius, Lithuania. Such developments are expected to propel the country's market growth during the forecast period.
