Global UAV Battery Market - Insights
A drone or an unmanned aerial vehicle (UAV) refers to a non-pilot aircraft which comprises of combined technologies such as computer vision, object avoidance technology, and artificial intelligence. Drones have been used for military applications over a decade, such as the Predator UAV. Defense forces are now increasing adoption of small drone/UAV technologies for the purpose of conducting surveillance and reconnaissance during missions, which is expected to drive the market for UAV batteries during the forecast period.
The military expenditure for drone technologies has been increasing. For instance, the military budget announced by the U.S. government was US$ 583 billion in 2017, which was increased to US$ 640 billion in 2018. This will allow manufacturers of drones, UAVs and their components, higher opportunities to increase their contribution in the market share.
The global UAV battery market is expected to witness significant growth during the forecast period (2018–2026). The market growth is attributed to increasing demand for high performance, long duration flight time UAVs for military applications. Furthermore, as per Coherent Market Insights, growth of the UAV battery market is also propelled by the drone industry growth, whose production was pegged at 2.2 million units in 2016, and is expected to witness high growth during the forecast period (2018-2026).
Figure 1. Global UAV Battery Market Share (%), by Region (2017 & 2026)
Source: Coherent Market Insights, 2017-18
Increasing production of UAVS for deployment in the militaries across various regions is expected to aid in growth of the market
Increasing UAV production across various countries and regions is leading to high demand for different types of batteries. For instance, according to Worldwide Market Reports’ (WMR) analysis, the global military UAV production reached 3,117 units in 2017. In the UAV market, the U.S. accounted for the largest share of 37.8% by volume, and 41.9% by value, in 2017. Moreover, Asia Pacific accounted for the second largest share in the UAV market in 2017, and is the second largest market for UAV batteries, followed by Europe and the rest of the world. Therefore, increasing production of UAVs across various regions is expected to drive growth of the global UAV battery market.
As per Coherent Market Insights, in 2015, the drone industry witnessed a steep growth due to the rule by Federal Aviation Administration (FAA), which granted new exemptions for companies to operate drones in the U.S. This factor is also expected to aid the market growth.
Figure 2. Global UAV Battery Market Share (%), By UAV Type (2017)
Source: Coherent Market Insights, 2016-17
Increasing defense expenditure by governments is expected to aid growth of the market
Increasing military expenditure by governments across the globe is creating lucrative opportunities for market players in the global UAV battery market. Increasing adoption of UAVs for strengthening defense and military capabilities, is a major factor that is expected to aid the growth of the market. The adoption rate of UAVs is high in North America and Asia Pacific due to high military expenditure in these regions. For instance, according to WMR’s analysis, the U.S. military budget was announced as US$ 583 billion in 2017, which was later increased to US$ 640 billion in 2018. Moreover, the defense budget announced by the government of India in 2017 was US$ 52.5 billion, which increased from US$ 51.1 billion in 2016. Increasing budget for defense and military purposes has led to a high expenditure on UAVs and other related technologies, which is expected to drive growth of the market.
Increasing use of UAVs to perform patrolling operations at borders is expected to drive the market growth
Increasing demand for UAVs in border forces such as army, navy, and air force around the world for intelligence, reconnaissance, and surveillance purposes is expected to boost growth of the market. Moreover, increasing demand for electronic surveillance and high number of missions performed by drones is also expected to increase the market growth. For instance, according to WMR analysis, the U.S. Customs and Border Protection (CBP) agency completed 635 drone missions in 2017, which was the highest number of missions performed with drones till date.
Some of the key players operating in the Global UAV Battery Market include Ballard Power Systems, Cella Energy Limited, Denchi Power Ltd., EaglePicher Technologies, H3 Dynamics, Kokam, OXIS Energy Ltd., Sion Power Corporation, and Tadiran Batteries GmbH.
UAV battery market is expected to witness significant demand in terms of military application over the forecast period, owing to high performance, and long duration flight time of UAVs. However, high cost of military UAVs and their components is one of the major factors restraining growth of the UAV battery market.
The global UAV battery market growth is attributed to increasing deployment of drones for military activities globally, in addition to rising demand of medium altitude long endurance UAVs for operations such as intelligence, surveillance, and reconnaissance (ISR). For instance, in 2018, the United States Air Force (USAF) deployed drones in Afghanistan for the purpose of tracking terrorists involved in a bomb planting mission. Additionally, in June 2019, the United States Army signed a contract worth US$ 40 million with FLIR Systems to develop miniature, helicopter-like drones for conducting reconnaissance during their operational missions. Moreover, increasing deployment of tactical UAVs along with multi-mission capabilities for ISR and attack missions is another factor aiding the growth of UAV battery market globally.
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