World Air Traffic Control Market to Accelerate, Grow at 7% CAGR, Top $4 Billion by 2001

Business Wire, July 12, 1995

MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--July 12, 1995--With Chinese and Russian markets showing the most rapid expansion, the worldwide air traffic control equipment market will grow from $2.8 billion in 1994 to $4.4 billion by the year 2001 at a 7 percent compound annual rate, projects a new study just released by Frost & Sullivan.

In 1994, 71 percent of market revenues were accounted for by air traffic management (ATM) equipment, 11 percent radar, 10 percent navigational aids and 8 percent turnkey systems, says the report, WORLD AIR TRAFFIC CONTROL EQUIPMENT MARKETS: DIVERSE OPPORTUNITIES FOR INCREASED ATC EQUIPMENT SALES PROLIFERATE.

As of 1994, 46 percent of market revenues were accounted for by U.S. sales, 17 percent Europe (excluding Russia/CIS), 13 percent the Pacific Rim (excluding China), 7 percent China and 4 percent Russia, according to the study.

Other regions with significant purchases will include Latin America, India and the Middle East as developing world markets come of age. The eventual strength of these markets will be directly dependent on overall economic performance in these regions.

Worldwide growth will accelerate in the years ahead, rising from 5 percent in 1994 to 8 percent by the turn of the century, says the study.

More advanced yet cost-effective technologies are increasingly penetrating once-closed national markets. Turnkey services, usually provided by radar firms that gain extra value-added revenue from installing and integrating the entire ATC equipment package, will be most common in areas with relatively underdeveloped infrastructures such as China and eastern Europe.

Massive radar and ATM upgrades are under way in North America. In Western Europe, pan-European organizations are focusing on integrating diverse national systems.

Currently uncertain funding will be critical for eastern European modernization. Eastern European nations seek to coordinate their ATC infrastructure more closely with that of western Europe while their civilian authorities try to wrest aviation administrations from longstanding military control. Western companies have created several consortia for long-term market access to Russia/CIS, a regional market with great potential for ATM and radar procurement despite slow-starting modernization plans.

The ATC equipment market in China will grow rapidly, particularly in the prosperous southeastern region, and China will emphasize higher-quality products in the coming years. China remains a confusing market for western companies, but it remains one of the most competitive and coveted as well.

Navigational aid companies are particularly focused on the Asia/Pacific region, though significant opportunities will be available there for radar and ATM vendors as well.

ATM remains the highest priority of most national aviation organizations. Prospects of satellite-based Differential Global Positioning System (DGPS) and automatic dependent surveillance (ADS) affecting the worldwide radar market remain several years away.

Frost & Sullivan is an international high-technology research firm. All Frost & Sullivan reports are based on extensive interviews with marketing and technical experts from selected companies in each market segment. Primary research is validated by thorough analysis of available secondary research. Frost & Sullivan is the leading publisher worldwide of high-technology research reports. -0-

Report: 5187-18                    Price: $2995