Saab 2014 Annual Report Download - page 14

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MARKET
DESCRIPTION
After declining for a number of years, global defence spending is expected to rise
going forward, mainly due to global economic growth, but also because of growing
geopolitical turmoil. While North America has historically been the dominant market
for defence materiel, a shift toward Asia is expected in coming years.
In 2014, global defence spending rose for
the rst time since 2010. Aer a temporary
slowdown in 2015, the global market is
expected to grow by an annual average of
2per cent between 2016 and 2020. Overall
economic growth will be the main driver.
Growth is mainly expected in Asia, where
China, India and the countries of Southeast
Asia are driving the market. Europe is gene-
rating a slight growth, mainly driven by
Poland and Turkey.
In the Middle East, growth has been high,
but is slowing owing in part to falling oil
prices. e fastest growth in recent years
has been in Russia, but the growth rate there
is expected to decline due to economic
conditions in the country.
North America 36%
+1%
Latin America 3%
+3%
Nordic 1%
+2%
Rest of Europe 17%
+1%
Middle East 8%
+2%
Africa 2%
+3%
Asia 17%
+3%
China 12%
+6%
Russia 4%
+2%
Upper figure: Estimated share of global defence materiel market 2016 – 2020
Lower figure: Estimated average annual growth rate 2016– 2020
Source: IHS Group, December 2014
Source: IHS Group, December 2014
Value of the global defence materiel market, 2008 – 2020
MUSD
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
-20E-19E-18E-17E-16E-15E-14E-13-12-11-10-09-08
10 – SAAB ANNUAL REPORT 2014