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2023

Electro Optics Market

Electro Optics Market Size, Share, Competitive Landscape and Trend Analysis Report by Application, by End User : Global Opportunity Analysis and Industry Forecast, 2023-2032

SE : Electronic Systems and Devices

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Author's: Saurav Singh | Sonia Mutreja
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Electro Optics Market Research, 2032

The global electro optics market was valued at $10.2 billion in 2022, and is projected to reach $15.6 billion by 2032, growing at a CAGR of 4.5% from 2023 to 2032.

Electro Optics is a branch of physics and engineering that deals with the interaction between electromagnetic (EM) radiation (such as light) and electric fields. It includes the research and development of technologies and systems that modify and regulate the behavior of light using electrical fields or voltage.

Electro Optics Market

The electro optics market is segmented into Application and End User.

Electro Optics Market by Application

By application, the market is divided into air based, land based, and naval based. In 2022,the Air Based segment dominated the market in terms of revenue.

Electro Optics Market by End User

By end user, the electro optics market size is segmented into defense, aerospace, and homeland security.In 2022, the defense segment dominated the market in terms of revenue and is expected to follow the same trend during the forecast period. 

Electro Optics Market by Region

Region wise, it is analyzed across North America (the U.S., Canada, and Mexico), Europe (the UK, Germany, France, Russia, and the rest of Europe), Asia-Pacific (China, Japan, India, South Korea, and the rest of Asia-Pacific), and LAMEA (Latin America, the Middle East, and Africa). North America, Specifically the U.S., remains a significant participant in the electro optics market.

There are various advantages to having electro optics. For instance, electro optics speed and precision in modulating and transmitting optical signals, making it essential in high-speed telecommunications and data transmission. electro-optic devices possess the qualities of being compact, lightweight, and robust, rendering them well-suited for portable uses like cameras, sensors, and imaging systems. They also exhibit lower vulnerability to electromagnetic interference in contrast to conventional electronic devices. Moreover, electro-optics facilitates non-intrusive sensing capabilities, as evidenced in applications such as medical imaging and remote sensing.

In addition, electro optics helps monitor the quality and longevity of rubber parts. This, in turn, enables predictive maintenance, preventing unexpected failures and reducing downtime.  

The global electro optics market demand is expected to witness notable growth during the forecast period, owing to rise in demand for surveillance and security systems. Moreover, Advantages of electro optical systems, and increase in military expenditure‐¯worldwide drives the electro optics market outlook as the increase in military expenditure worldwide by military organizations and defense forces has led to a rise in demand for electro-optical technologies. It has many defense applications, such as surveillance and reconnaissance to target acquisition and detection of enemy attack threats. The rising focus of several countries on modernizing their military forces and upgrading to modern warfare products is raising the demand for electro-optical systems. Electro optics technology is also utilized for testing in the aerospace industry and by border protection authorities to detect incursions. The electro-optical systems constitute electro-optical and infrared sensors, thermal imagers, and more which provide precise optical data in all conditions such as daylight, lowlight night, or dark. It has increased the use of electro optics in homeland security (airborne), situational awareness, fire control systems, search and rescue operations, acquisition of targets, intelligence, surveillance, and reconnaissance. Furthermore, the rapid technological advancements and increase in demand for electro optical systems in the military sector is projected to shape the future of the electro optics market. With the increase in adaptation of advanced technological instruments, in the field of defense and security leading to more opportunities for electro optical system and equipment. Technological advancements in sensors and optics lead to higher-resolution imaging capabilities. This is particularly beneficial in medical imaging, surveillance, remote sensing, and scientific research. Moreover, the growing usage of advanced sensor-based systems in military space is pushing the demand for electro-optical systems. Furthermore, the electro-optics market is being driven by increased deployment in unmanned vehicles and for battle-space awareness, as well as increased use by armed forces to cope with security threats more effectively.

However, the high initial investment of electro optics is acting as one of the prime factors that restrain the electro optics market growth. As the development of electro optics technology involves complex and advanced components, it is very costly to manufacture, and implement. The deployment, maintenance, and development require a large amount of investment. It requires investment in the design and testing of components, sensors, and systems. In addition, as demand for the electro-optics market grows, it may also need to invest in scaling up production capacity to meet market needs. Furthermore, the installation process itself can be complex and require expert professionals, adding to the overall cost.

The electro optics market is segmented based on application, end user, and region. By application, the market is bifurcated into air based, land based, and naval based. In 2022, the Air Based segment dominated the market in terms of revenue and is expected to follow the same trend during the forecast period and is expected to emerge as the fastest growing segment of the market during the forecast period 2023-2032.  As per the end user, the market is segmented into defense, aerospace, and homeland security. In 2022, the defense segment dominated the market in terms of revenue and is expected to follow the same trend during the forecast period. However, the aerospace segment is expected to grow at a high CAGR during the period of 2023-2032.

Region wise, it is analyzed across North America (the U.S., Canada, and Mexico), Europe (the UK, Germany, France, Russia, and the rest of Europe), Asia-Pacific (China, Japan, India, South Korea, and the rest of Asia-Pacific), and LAMEA (Latin America, the Middle East, and Africa). North America, Specifically the U.S., remains a significant participant in the electro optics market. Major organizations and government institutions in the North America region have significantly put resources into action to develop enhanced electro optics devices which is driving the growth of the electro optics industry in North America.

COMPETITION ANALYSIS

Competitive analysis and profiles of the major global electro optics market forecast players that have been provided in the report include Lockheed Martin Corporation, Thales Group, FLIR Systems Inc., BAE Systems plc, Northrop Grumman Corporation, Raytheon Technologies Corporation, L3Harris Technologies, Inc., Leonardo DRS, Textron Systems Corporation., and Safran Group.

Country Analysis

North America-wise, the U.S. acquired a prime share in the Electro optics market in the North American region and is expected to grow at a high CAGR of 3.78% during the forecast period of 2023-2032. The U.S. holds a dominant position in the electro optics market, owing to an increase in adoption of advanced technologies.

In Europe, the UK dominated the Europe Electro optics market share in terms of revenue in 2022 and is expected to follow the same trend during the forecast period. Furthermore, the Germany is expected to emerge as one of the fastest growing countries in Europe's electro optics industry with a CAGR of 5.91%, owing to a strong defense and military across the region.

In Asia-Pacific, China holds a dominated market share in Asia-Pacific region and is expected to follow the same trend during the forecast period, owing to its increase in investment in defense sector and increasing adoption of modern technology for safety purpose. However, India is expected to emerge as a dominated country in electro optics market Asia-Pacific region.

In LAMEA, the Middle East is growing the fastest in the electro optics market because of its growing economy and increase in investment in defense sectors. Moreover, the Africa region is expected to grow at a high CAGR of 3.15% from 2023 to 2032, owing to increase in procurement of Unmanned Surface Vessels (USVs) integrated with electro-optics and ongoing developments in electro-optics technology.

TOP IMPACTING FACTORS

The electro optics market is anticipated to expand significantly during the forecast period owing to the rise in demand for surveillance and security systems. In addition, the advantages of electro optical systems fuel the market growth. Moreover, the electro optics market is anticipated to benefit owing to the rapid technological advancements, and the increase in demand for electro optical systems in the military sector is expected to present enormous opportunities for the market over the forecast period. On the other hand, high initial investment is anticipated to restrain the market growth during the forecast period.

HISTORICAL DATA & INFORMATION

The electro optics market is highly competitive, owing to the strong presence of existing vendors. Vendors of electro optics machines with extensive technical and financial resources are expected to gain a competitive advantage over their competitors because they can cater to market demands. The competitive environment in this market is expected to increase as technological innovations, product extensions, and different strategies adopted by key vendors increase.

KEY DEVELOPMENTS/ STRATEGIES

Lockheed Martin Corporation, L3Harris Technologies, Inc., Textron Systems, Safran Group, and Northrop Grumman Corporation are the top 5 companies holding a prime share in the electro optics market. Top market players have adopted various strategies, such as product launch, branding, investment, integration and acquisition to expand their foothold in the electro optics market.

  • In February 2023, The U.S. Marine Corps awarded Northrop Grumman Corporation the initial production and operations contract for the next-generation handheld targeting system (NGHTS). NGHTS is a compact targeting system that provides advanced precision targeting and is capable of operation in GPS-denied environments.
  • In April 2023, Raytheon Technologies announced the launch of RAIVEN, an electro-optical intelligent-sensing capability, which enables pilots to have faster and more precise threat identification. RAIVEN identifies objects optically and spectrally simultaneously in real time.
  • On September 2023, Leonardo DRS announced a 5-inch stabilized, multi-sensor EO/IR payload gimbal, with market-leading high-definition nighttime imaging capability.
  • On June 2022, RADA Electronic Industries Ltd., a provider of advanced software-defined military tactical radars, and Leonardo DRS Inc. announced a definitive agreement to merge and become a combined public company. The capabilities of the two companies generated strong growth from a wide range of new and high-growth markets and are shaping the future battlefield for the U.S. military and its allies across all domains.

Key Benefits For Stakeholders

  • This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the electro optics market analysis from 2022 to 2032 to identify the prevailing electro optics market opportunity.
  • The market research is offered along with information related to key drivers, restraints, and opportunities.
  • Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
  • In-depth analysis of the electro optics market segmentation assists to determine the prevailing market opportunities.
  • Major countries in each region are mapped according to their revenue contribution to the global market.
  • Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
  • The report includes the analysis of the regional as well as global electro optics market trends, key players, market segments, application areas, and market growth strategies.

Electro Optics Market Report Highlights

Aspects Details
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Market Size By 2032

USD 15.6 billion

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Growth Rate

CAGR of 4.5%

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Forecast period

2022 - 2032

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Report Pages

240

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By Application
  • Air Based
  • Land Based
  • Naval Based
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By End User
  • Defense
  • Aerospace
  • Homeland Security
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By Region
  • North America  (U.S., Canada, Mexico)
  • Europe  (UK, Germany, France, Russia, Rest of Europe)
  • Asia-Pacific  (China, India, Japan, South Korea, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
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Key Market Players

Lockheed Martin Corporation, Safran Group, Northrop Grumman Corporation, Raytheon Technologies Corporation, FLIR Systems Inc., BAE Systems plc, Leonardo DRS, L3Harris Technologies, Inc., Textron Systems, Thales Group

Analyst Review

The global electro optics market holds high potential for the semiconductor industry. The business scenario witnesses an increase in the demand for electro optics devices, particularly in developing regions, such as China, India, Japan, U.S., UK, Russia, France, and others. Companies in this industry have been adopting various innovative techniques to provide customers with advanced and innovative product offerings.

The rise in demand for surveillance and security systems, and advantages of electro optical systems drive this market. However, high Initial Investment impedes the growth of the market. During the forecast period it is anticipated to witness an increase in demand for electro optical systems in the military sector infrastructure is expected to create lucrative opportunities for the key players operating in this market.

The market participants are expected to introduce technologically advanced products to remain competitive in the market. Product launch and collaboration are the prominent strategies adopted by the market players.

Author Name(s) : Saurav Singh | Sonia Mutreja
Frequently Asked Questions?

Rise in demand for surveillance and security systems is the upcoming trends in electro optics market in the world.

Air Based is the leading application of electro optics market.

North America is the largest regional market for electro optics.

$15.63 billion is the estimated size of electro optics.

Lockheed Martin Corporation, Thales Group, FLIR Systems Inc., BAE Systems plc, Northrop Grumman Corporation, Raytheon Technologies Corporation, L3Harris Technologies, Inc., Leonardo DRS, Textron Systems Corporation., and Safran Group re the top companies to hold the market share in electro optic market.

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Electro Optics Market

Global Opportunity Analysis and Industry Forecast, 2023-2032