Armored Vehicle Market

Market Overview

The global armored vehicle market size was valued at USD 25.40 billion in 2023. It is estimated to reach USD 36.46 billion by 2032, growing at a CAGR of 4.1% during the forecast period (2024–2032). In the past few years, there has been a rise in the geopolitical disputes in several countries, the Russia-Ukraine war, the Israel and Hamas conflict, etc., which has increased the demand for enhanced defense infrastructure, thereby driving the global armored vehicle market. Moreover, the market's leading players are launching innovative and advanced armored vehicles to improve their market share, thereby creating opportunities for the growth of this market.

An armored vehicle is a military or civilian vehicle designed to withstand attacks and protect occupants. Typically fortified with materials such as steel, ceramic, or composite armor, these vehicles resist bullets, shrapnel, and explosive devices. Armored vehicles come in various forms, including tanks, armored personnel carriers (APCs), and mine-resistant ambush-protected (MRAP) vehicles. They are equipped with advanced technologies like ballistic glass, run-flat tires, and reactive armor to enhance survivability in combat situations. Armored vehicles play crucial roles in modern warfare, providing mobility and security to troops, transporting personnel and supplies, and executing offensive or defensive maneuvers with increased safety and resilience.

Market Highlights

• Combat vehicles dominate the product segment
• Wheeled armored vehicles dominate the mobility segment
• Manned armored vehicles dominate the mode of operation segment
• Asia-Pacific is the highest shareholder in the global market

Market Dynamics

Market Drivers

Rising Geopolitical Tensions

Geopolitical tensions and conflicts worldwide drive demand for armored vehicles as nations seek to bolster their defense capabilities. Heightened regional rivalries, territorial disputes, and the proliferation of non-state actors contribute to uncertainty and insecurity, prompting governments to prioritize military modernization. The need for armored vehicles is particularly acute in regions prone to instability or conflict, such as the Middle East, Asia-Pacific, and Eastern Europe.

Moreover, interventions in asymmetric warfare, counterinsurgency operations, and peacekeeping missions underscore the importance of adaptable and robust armored platforms. As geopolitical dynamics evolve, so do defense strategies, with armored vehicles serving as essential tools for maintaining strategic deterrence, protecting vital interests, and ensuring national security in an increasingly volatile global landscape.

Market Restraint

Budget Constraints

Budget constraints significantly restrain the armored vehicle market as governments face competing demands for limited resources. High development, manufacturing, and maintenance costs restrict procurement capabilities, particularly during economic downturns. Therefore, governments must prioritize spending across various sectors, potentially reducing allocations for defense procurement, including armored vehicles. Moreover, budget fluctuations can lead to uncertainty in long-term procurement plans, affecting investment decisions by defense contractors. Consequently, constrained budgets may limit the scale and pace of armored vehicle acquisitions, impacting market growth and innovation in the industry.

Market Opportunities

Rising Product Launches

The market's key players are introducing new and advanced armored vehicles. For instance, in February 2024, BMW India officially introduced the BMW 7 Series Protection, an armored luxury limousine, in the Indian market. Each door of the BMW 7 Series Protection weighs around 200kg. All doors are equipped with motorized assistance for opening and closing, and they can also be automatically closed with the press of a button from inside the vehicle. The BMW 7 Series Protection has a VR9 protection grade, indicating its high resistance level against various threats.

Furthermore, in March 2024, Inguar, a Ukrainian defense company, recently revealed its newest armored combat vehicle, the Inguar-3. The Mine-Resistant Ambush Protected (MRAP) vehicle is a highly capable tactical vehicle designed to perform exceptionally well in diverse military settings. The Inguar3 vehicle features an advanced monocoque body design and is offered in multiple varieties, including two chassis options: the 4x4 and the 6x6. These chassis are specifically engineered to handle both urban and off-road obstacles effortlessly. This is

Regional Analysis

Based on region, the global armored vehicle market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

Asia-Pacific's armored vehicle market share is expected to expand substantially during the forecast period. The expansion of the military and defense industry in the Asia-Pacific region can be attributed mostly to escalating geopolitical issues and the mounting threat of terrorist attacks. The Asia-Pacific area is experiencing increasing geopolitical tensions due to China's expansionist strategy in the South China Sea and border disputes with India. As a result, defense spending in the region is likely to surge, leading to an increased demand for armored vehicles in the foreseeable future. Moreover, several international players are expanding their foothold in this region due to untapped opportunities.

For instance, in September 2023, Paramount Group, a South African company, expanded its production facility in India to increase the variety of combat vehicles it will create. This includes the addition of 4x4 and 6x6 infantry fighting platforms to cater to global consumers. This expansion capitalizes on the preexisting industrial connections between the partners. In 2021, Paramount and Bharat Forge entered a partnership agreement to jointly manufacture India's Kalyani M4 armored personnel carrier. Several units have been supplied to the Indian Army under a contract valued at approximately USD 21.4 million. These agreements demonstrate a broader pattern among international defense firms to increase manufacturing in India to reduce their reliance on China and Russia. These factors are estimated to drive the regional market growth.

North American region is estimated to grow at a significant pace. The main driver behind the expansion of the North American market is the United States' significant defense spending, which exceeds that of other countries. In 2022, the United States allotted 877 billion U.S. dollars to its defense sector. This was almost 40% of worldwide military spending for that specific year, amounting to 2.2 trillion U.S. dollars. This accounted for 3.5% of the United States' gross domestic product (GDP). In addition, the U.S. Congressional Budget Office predicts that defense spending will rise to 1.1 trillion U.S. dollars by 2033.

Segmental Analysis

The global armored vehicle market is segmented by product, type, mobility, mode of operation, point of sale, and systems.

Based on the product, the global armored vehicle market is into combat vehicles and combat support vehicles. 

The combat vehicles segment dominates the global market. Combat vehicles are specialized military vehicles designed and equipped for combat zones. These vehicles range from tanks and armored personnel carriers to infantry fighting vehicles and self-propelled artillery. They are typically armored to varying degrees, protecting their crew and passengers against small arms fire, artillery shrapnel, and other battlefield hazards. Combat vehicles are equipped with offensive weaponry such as cannons, machine guns, missiles, and sometimes even reactive armor to effectively engage and neutralize enemy threats. They play crucial roles in modern warfare, providing mobility, firepower, and protection to ground forces, enabling them to maneuver and engage hostile forces with tactical advantage.

Based on type, the global armored vehicle market is bifurcated into electric and conventional armored vehicles.

Electric armored vehicles are military vehicles powered by electric propulsion systems, utilizing batteries or fuel cells instead of traditional combustion engines. They offer advantages such as reduced noise, heat signature, and emissions compared to their conventional counterparts. These vehicles integrate advanced armor protection to withstand ballistic threats, explosives, and other hazards encountered in combat zones. As sustainability and efficiency become increasingly important, electric armored vehicles represent a modernization trend in military operations, combining cutting-edge technology with improved performance and environmental consciousness.

Based on mobility, the global armored vehicle market is bifurcated into wheeled and tracked. 

The wheeled armored vehicle segment owns the highest market share. Wheeled armored vehicles are military vehicles equipped with armor and powered by wheels, providing mobility and protection to troops and equipment. These vehicles typically feature reinforced hulls to withstand ballistic threats and provide defense against explosives. Their wheeled configuration offers rapid deployment and enhanced maneuverability over varied terrain compared to tracked vehicles.

Wheeled armored vehicles are versatile platforms for reconnaissance, troop transport, and fire support. They often incorporate advanced technology such as remote weapon stations, surveillance systems, and communication equipment. Their agility, speed, and armor protection make them vital assets in modern warfare scenarios, balancing firepower, mobility, and protection for military operations.

Based on mode of operation, the global armored vehicle market is segmented into manned and unmanned armored vehicles. 

The manned armored vehicles segment accounted for the largest market share. Manned armored vehicles, often called armored personnel carriers (APCs) or infantry fighting vehicles (IFVs), are military vehicles designed to transport troops and offer them protection and firepower on the battlefield. These vehicles typically feature heavy armor plating to shield occupants from small arms fire and explosive devices. They are equipped with various weapons systems, such as machine guns, cannons, or anti-tank missiles, to engage enemy forces effectively. Manned armored vehicles play a crucial role in modern warfare by enhancing troop mobility, survivability, and combat effectiveness in diverse operational environments, ranging from urban areas to rugged terrain. Their versatility and firepower make them essential for ground forces in offensive and defensive operations.

Based on the point of sale, the global armored vehicle market is bifurcated into OEM and retrofit. 

The OEM segment held the largest market share. The sale of armored vehicles through Original Equipment Manufacturers (OEMs) involves the manufacturers' direct distribution of these specialized vehicles. OEMs, renowned for their expertise in engineering and production, provide customers with a comprehensive solution for armored vehicle procurement. This process ensures quality control, adherence to industry standards, and customization options tailored to clients' needs. By collaborating with OEMs, customers benefit from direct access to cutting-edge technology, ongoing support, and streamlined communication channels for efficient transactions. Moreover, OEM sales often encompass after-sales services, including maintenance and training, further enhancing the value proposition for buyers seeking reliable and secure transportation solutions.

Based on systems, the global armored vehicle market is bifurcated into engines, drive systems, ballistic armor, fire control systems (FCS), and navigation systems. 

The fire control systems (FCS) accounted for the highest market share. Fire Control Systems (FCS) are complex technological setups used in military applications, primarily for directing and optimizing the accuracy of weapons fire. These systems incorporate various components such as sensors, radar, targeting devices, and computers to calculate firing solutions, track targets, and precisely guide projectiles. FCS integrates data from multiple sources to assess factors like distance, trajectory, wind speed, and target movement, enabling efficient engagement even in dynamic combat situations.

Recent Developments

November 2023- The United States and India jointly declared their intentions to engage in the collaborative production of Stryker armored vehicles as a strategic measure to counteract the growing military power of China in the Asian region. The objective of the move is to bolster the collective security of both nations through the expansion of supply chains and the improvement of military interoperability.

March 2024- BAE Systems unveiled its newest Armored Multi-Purpose Vehicle (AMPV) prototype with an autonomous turret at the 2024 AUSA Global Force Symposium.