The US aerospace industry yesterday forecast that military demand for unmanned aircraft would double over the next five years after rising 600% since 2004.
Analysts agreed that unmanned planes remained wildly popular, and noted that many US defense companies are scrambling to get a piece of the market either by developing their own capabilities or buying smaller companies that are already doing that kind of work.
But Richard Aboulafia, analyst with the Virginia-based Teal Group, said the sector accounted for just $1.5 billion to $2 billion in revenues a year, or 10 to 15% of the global fighter market.
“This is not a major part of the industrial base, there’s not a lot of manufacturing activity, and a lot of the numbers are absorbed by electronics and network systems,” Aboulafia told the Reuters Aerospace and Defense Summit.
“It’s nowhere near the same industrial footprint as traditional manned aircraft and space systems,” he said.
Remotely piloted aircraft, as the Air Force is now calling them, have already had a “profound impact” on the military service in recent years, and will continue to significantly change the way it operates, Air Force Secretary Michael Donley told the summit this week.
The Air Force plans to begin funding development of a new long range strike capability in fiscal 2011, a family of manned and unmanned aircraft, Donley said.
Just last week, the service acknowledged the existence of a formerly classified unmanned plane, dubbed by some as the “Beast of Kandahar,” that is being used for intelligence gathering over Afghanistan.
Jim McAleese, a Virginia-based defense consultant, said the new program was relatively small and would likely result in only minor orders for Lockheed Martin Corp.
Aboulafia said the only large new start in the unmanned sector in recent years was the Predator, developed by privately held General Atomics of San Diego.
Northrop seen as well-positioned
Among publicly traded companies Northrop Grumman Corp, which builds the high-altitude Global Hawk unmanned surveillance plane, was probably the best positioned, he said.
Northrop also won a contract to build a Global Hawk variant for the Navy to use for maritime surveillance, and its X-47 unnamed plane was being studied for combat use.
Boeing Co’s position was less attractive, said Aboulafia, noting Boeing’s X-45 might have gone into the classified world, but it was “not part of anyone’s actual procurement plans.”
Dennis Muilenburg, head of Boeing’s defense division, told the Reuters summit that his company was still keeping its eyes open for possible acquisitions in the unmanned systems sector after making several acquisitions in recent years.
He said Boeing was also keen to bid for the Pentagon’s new long-range strike program, which defense officials say will include an unmanned component.
L-3 Communications Holdings Inc, which already makes a large number of sensors, invested a significant amount of its own money over the past year to develop a medium-altitude plane called Mobius that flies with a pilot or without.
The plane, which can carry up to 1000 pounds of weapons and can stay in the air for up to 24 hours, cost about half that of competitor unmanned planes, L-3 Chief Executive Michael Strianese told the summit on Tuesday.
Strianese said L-3’s intelligence, surveillance and reconnaissance (ISR) segment grew 25 percent over the past year, and he expected further funding for ISR programs in coming years because of the ability of full-motion video to keep US troops out of harm’s way.
“We are hoping that the continued unabated demand for this full-motion video will drive the demand for the Mobius system,” he said, noting that L-3 planned to demonstrate an operational Mobius to the military services by July.