Global amphibious landing craft market worth $11 billion by 2020 – report


The global amphibious landing craft market is expected to reach $11 billion by 2020, according to a new report by Technavio, which notes an increase in demand for amphibious landing craft because of their wide application by civil and military forces.

Among end-users, military forces account for 80% of the market, with civil users accounting for the remaining share, Technavio Research said in its report last month.

Landing craft provide a number of benefits in military operations, such as in the transportation of armoured vehicles and troops, as well as the carrying out of humanitarian missions and relief work. There has been an increased utilization of large amphibious ships in military operations. These craft are also used to carry out surveys, which are used for scientific research.

According to Abhay Singh, lead analyst for defence research at Technavio, “Increased awareness of large amphibious ships and the demand for automated systems are some of the key drivers of the market.”

Technavio notes that the Americas is the largest defence spender as well as defence exporter, accounting for 31% of global deals and is the largest market segment in the world, expected to spend $5 billion on landing craft through 2020.

Growth in maritime budget is in response to marine threats such as smuggling, illegal immigration, human trafficking, and cargo thefts. Also, the 9/11 terrorist attack has prompted Americans to enforce the law to ensure smooth commercial activities by sea. Maritime security standards in the US follow the Safety of Life at Sea (SOLAS), International Maritime Organization, and International Ship and Port Facility Security codes, which are strictly followed for safe international trade.

The US Navy awarded a contract worth USD 744 million to General Dynamics National Steel and Ship Building Company in 2011, to develop two mobile landing-platform vessels. The navy also has plans to procure five mobile landing-platform vessels by 2017. The US Navy will thus purchase advanced landing craft, replacing traditional ones, during the forecast period.

The amphibious landing craft market for Europe, the Middle East and Africa (EMEA) is expected to reach $3 billion by 2020. European countries accounted for 12% of global arms sale during 2010-2014. The growth in this region is mainly from the Middle East and is expected to grow at a compound annual growth rate (CAGR) of 10% over the next three years.

The majority of international trade in Europe is seaborne, and this route has become one of the most-effective channels for economic development for the region. However, 104,049 people crossed the European border illegally in 2010. Similarly, the Middle East and Africa are suffering from huge losses due to piracy in the Gulf of Aden, the Suez Canal, the Red Sea, and the Arabian Sea. The region is, therefore, expected to increase investments to counter crimes. Such contracts are expected to propel the market during the forecast period, Technavio said.

The amphibious landing craft market in Asia-Pacific (APAC) is expected to reac $3 billion by 2020. China, South Korea, and Japan are continuously increasing their defence budgets to enhance national security amid rising political tensions in these countries.
“The rise in illegal activities through sea routes is one of the reasons why India has increased its defence imports. The country is currently the largest defence importer in the world, accounting for 15% of global deals. The Mumbai attack in November 2008 prompted maritime security agencies across the world to modernize their equipment,” said Abhay.

In 2013, the Indian Navy awarded a contract worth $482 million to Garden Reach Shipbuilders and Engineers to construct eight LCUs. In 2014, PLA Navy of China awarded a contract worth $315 million to Feodosiya Shipbuilding Company to develop two Zubr-class landing craft. This vehicle will enable the navy to carry three battle tanks or 140 troops with 10 armoured vehicles. The market in APAC is likely to grow significantly because of such contracts.

Technavio said that key suppliers of landing craft include Almaz, Griffon Hoverwork, L-3 Unidyne, Marine Alutech and Textron. The other prominent vendors mentioned in the report are: Abu Dhabi Shipbuilding Company, Garden Reach Shipbuilders and Engineers, Goa Shipyard, and General Dynamics NASSCO.