Global Defense Contracts Maintain Momentum
Strategy Analytics says the defense industry is benefitting despite tight budgets.
Despite tightening defense budgets in the US, contract activity maintained its momentum in January, with radar systems featuring prominently.
The Strategy Analytics service report, “Defense Electronics Industry Review: January 2011," notes that contract awards totalled in excess of a billion as the first month of 2011 drew to a close.
In addition, M&A (merger and acquisition) activity in the defense sector continued to strengthen as cash-rich, large firms look to secure market share, key technologies or market entry. There were no less than a dozen defense-oriented mergers, acquisitions and partnerships announced.
“Though some industry observers have warned of a flat market ahead, the focus on advanced systems is driving contract activity for the major players which should translate into good business for their sub-contractors and component makers," says Asif Anwar, Director, ADS service.
“For example, there were a number of radar systems-related contracts in January. Of particular note, were contracts going to the usual players, Raytheon, Lockheed Martin, Saab and Thales.Airborne and naval platforms received the most attention."
Anwar concludes, “This contract activity represents continued opportunities for the semiconductor industry. Looking ahead, DARPA’s (Defense Advanced Research Projects Agency) aims to combine digital-to-analog (D/A) converters and high-power amplifiers, which will provide new avenues for growth".
Eric Higham, North American Director for ADS commented, “Electronic warfare activity was also strong with IED (improvised explosive device) jamming contracts going to ITT and Raytheon, while Cobham, Harris and Rockwell Collins received communications-related contract awards."