Report Overview

United Kingdom Defense Market - Industry Trends & Forecast Report, 2031

United Kingdom Defense Market size was estimated to be worth USD 43.72 billion in 2024. During the forecast period between 2025 and 2031, United Kingdom Defense Market size is projected to grow at a CAGR of 4.21% reaching a value of USD 58.36 billion by 2031. Major growth factors for United Kingdom Defense Market include increasing geopolitical tensions, heightened security concerns, and rising military expenditures. The major focus areas for the UK Ministry of Defence’s (MoD) 2024/25 defense budget include ‘warfighting readiness’ (equipping and training the armed forces for modern warfare), increasing spending on cyber defense, AI, and other innovative technologies, and expanding the submarine fleet, missiles, and ammunition factories. During 2024/25, United Kingdom defense budget was estimated at GBP 63.6 billion, and the MoD Spending Review anticipates it would increase to GBP 73.5 billion by 2028-29. Increasing budget allocation toward defense spending is forecast to boost the growth of United Kingdom Defense Market over the period under analysis.

Source: BlueWeave Consulting

Defense Market – Overview

Defense refers to a state's military actions aimed at safeguarding sovereignty, territorial integrity, and national security by countering aggression, subversive activities, and terrorism. The United Kingdom Defense Market is witnessing steady growth due to the rising adoption of integrated defense technologies, which combine multiple systems to enhance security capabilities. Advancements in automation and data analytics are driving modernization efforts, improving operational efficiency. The growing need for a highly adaptable and technologically advanced military is fueling demand for modern defense systems to support evolving security requirements.

United Kingdom Defense Market

Growth Drivers

Impending Military Threat across Europe

Escalating geopolitical tensions across Europe are driving substantial growth of the United Kingdom Defense Market, with countries increasing their military expenditures to enhance security and strategic capabilities. A key example is China, which recently announced a 7.2% rise in its defense budget for 2025, continuing its efforts to modernize its armed forces amid intensifying competition with the United Kingdom. As the world’s second-largest military spender, China aims to strengthen its defense capabilities. Meanwhile, the further spreading of prolonging Russia-Ukraine war reflects broader security concerns and is contributing to a rise in defense investments across the European region. The United Kingdom, meanwhile, continues to lead defense investments. The UK government targets to increase defense spending to 2.5% of the kingdom’s GDP by April 2027, with a target to reach 3% of GDP by 2034. The shift toward higher military budgets is shaping a new defense market cycle, benefiting defense contractors and encouraging advancements in military technology, including unmanned weapon systems, naval fleets, and aerospace defense. As geopolitical and military power dynamics shift and conflicts persist, defense spending is set to remain a key priority for many nations, driving long-term growth in United Kingdom Defense Market.

Challenges

Increasing Development and Maintenance Costs

Rapidly rising costs for development and maintenance of weapons and modern defense systems are significant restraints on the growth of United Kingdom Defense Market. The advanced defense technologies required for modern defense systems, such as next generation aircraft, naval vessels, and cyber defense solutions, demands substantial investments. Additionally, ongoing maintenance and upgrades of existing military assets further strain budgets. These financial burdens could limit the ability of nations to expand or modernize their forces. As a result, high costs could hinder military readiness and slow the adoption of innovative defense technologies, potentially impacting overall market growth.

Impact of Escalating Geopolitical Tensions on United Kingdom Defense Market

Escalating geopolitical tensions could significantly impact United Kingdom Defense Market by driving increased defense spending as nations prioritize military preparedness. Heightened conflicts and regional instability push countries to enhance their defense capabilities, leading to larger defense budgets and investments in advanced defense technologies. This surge in demand for military equipment, such as aircraft, weapons systems, and cybersecurity solutions, fuels the growth of United Kingdom Defense Market. Additionally, geopolitical uncertainty accelerates arms race dynamics and fosters strategic partnerships, further expanding the defense market. However, it also creates challenges, including rising competition, and the need for rapid innovations to address emerging security threats.

United Kingdom Defense Market

Segmental Coverage

United Kingdom Defense Market – By Armed Forces

Based on armed forces, United Kingdom Defense Market is divided into Air Force, Army, and Navy segments. The air force segment holds the largest share of United Kingdom Defense Market by armed forces. The modernization of aircraft capabilities in United Kingdom is expected to drive significant growth in the Air Force segment. The naval segment, followed by Air Force segment, holds a significant market share in United Kingdom Defense Market by armed forces.

Source: BlueWeave Consulting

United Kingdom Defense Market – By Product Type

United Kingdom Defense Market by product type is divided into Fixed Wing Aircraft (fighter jets, transport aircraft); Rotorcraft (helicopters); Ground Vehicles (tanks, armored fighting vehicles); Naval Vessels (aircraft carriers, submarines, destroyers); Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) Systems; Weapons & Ammunition; Protection & Training Equipment; and Unmanned Aerial Vehicles (UAVs) segments. The naval vessels segment holds the largest share of United Kingdom Defense Market by product type. The Royal Navy, a pivotal aspect of the UK defense, safeguards maritime interests with a diverse fleet. Its core mission is protecting maritime borders, detecting threats, and maintaining security in both peace and war. Rising defense spending spurs demand. With two aircraft carriers, six destroyers, eight frigates, 10 nuclear-powered submarines, eight mine countermeasures vessels, 26 patrol vessels, two survey vessels, one icebreaker, and 10 Royal Fleet Auxiliary ships, the Royal Navy pursues innovations and incorporates unmanned vessels and underwater systems.

United Kingdom Defense Market – By Operation

On the basis of operation, United Kingdom Defense Market is bifurcated into Autonomous Defense Equipment and Manual segments. United Kingdom, like other major countries across the world, is rapidly adopting unmanned systems, such as unmanned aerial vehicles (UAVs), unmanned combat vehicles, and autonomous drones, for various military applications, such as surveillance, reconnaissance, search and rescue operations, and tactical missions. Unmanned systems are equipped with advanced sensors, 360-degree situational awareness capabilities, and autonomous technologies, enabling them to operate remotely or make autonomous decisions without human intervention. It enhances operational efficiency, reduces risk to personnel, and improves mission outcomes. The surging demand for unmanned systems is also reflected by advancements in commercial and civilian sectors, where drones are used for purposes ranging from agriculture and delivery to infrastructure inspection. As research and innovations in unmanned systems continue to evolve, these technologies offer an expanding array of applications and further fuel the growth of unmanned systems in United Kingdom Defense Market.

Competitive Landscape

United Kingdom Defense Market is highly competitive, as a number of companies are competing to gain a significant market share. Key players in the market include Airbus, Babcock International, BAE Systems, Boeing, Lockheed Martin, MBDA, QinetiQ, Rolls-Royce, RTX Corporation, and Thales. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In November 2025 – Babcock Australasia completed the Critical Design Review for the Air Weapons Handling System of the Hunter class frigate program.

• In October 2025 - BAE Systems is reportedly to recognize about GBP 4.6 billion from the agreement between the United Kingdom and Turkey for the purchase of 20 Typhoon aircraft.

Scope of the Report

By Armed Forces

• Airforce

• Land

• Naval

By Product Type

• Fixed Wing Aircraft

  • Fighter Jets

  • Transport Aircraft

• Rotorcraft

  • Helicopters

• Ground Vehicles

  • Tanks

  • Armored Fighting Vehicles

• Naval Vessels

  • Aircraft Carriers

  • Submarines

  • Destroyers

• Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) Systems

• Weapons & Ammunition

• Protection & Training Equipment

• Unmanned Aerial Vehicles (UAVs)

By Operation

• Autonomous Defense Equipment

• Manual

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. United Kingdom Defense Market Insights
   1. End User Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Rising Geopolitical Tensions
         2. Increasing Defense Budgets
         3. Growing Threat of Cyber Warfare
      2. Restraints
         1. High Development & Maintenance Costs
         2. Regulatory Challenges & Export Retractions
      3. Opportunities
         1. Growing Demand for Unmanned Systems
         2. Rising in Space-based Defense Initiative
      4. Challenges
         1. Supply Chain Disruptions
         2. Geopolitical Sanctions & Trade Barriers
   3. Technological Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. United Kingdom Defense Market: Marketing Strategies
5. United Kingdom Defense Market: Pricing Analysis
6. United Kingdom Defense Market Overview
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Armed Forces
         1. Airforce
         2. Land
         3. Naval
      2. By Product Type
         1. Fixed Wing Aircraft
         2. Rotorcraft
         3. Ground Vehicles
         4. Naval Vessels
         5. Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) Systems
         6.  Weapons & Ammunition
         7.  Protection & Training Equipment
         8.  Unmanned Aerial Vehicles (UAVs)
      3. By Operation
         1. Autonomous Defense Equipment
         2. Manual
7. Competitive Landscape
   1. List of Key Players and Their Offerings
   2. United Kingdom Defense Company Market Share Analysis, 2024
   3. Competitive Benchmarking, By Operating Parameters
   4. Key Strategic Developments (Mergers, Acquisitions, Partnerships)
8. Impact of Escalating Geopolitical Tensions on United Kingdom Defense Market
9. Company Profiles (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, SWOT Analysis)

10. Key Strategic Recommendations
11. Research Methodology
    1.  Qualitative Research
       1.  Primary & Secondary Research
    2.  Quantitative Research
    3.  Market Breakdown & Data Triangulation
       1.  Secondary Research
       2.  Primary Research
    4.  Breakdown of Primary Research Respondents, By Region
    5.  Assumptions & Limitations

*Financial information of non-listed companies can be provided as per availability.

**The segmentation and the companies are subject to modifications based on in-depth secondary research for the final deliverable

List of Figures

Figure 1        United Kingdom Defense Segmentation

Figure 2        United Kingdom Defense Market Value Chain Analysis

Figure 3        Company Market Share Analysis, 2024

Figure 4        United Kingdom Defense Market Size, By Value (USD Billion), 2019–2031

Figure 5        United Kingdom Defense Market Share, By Armed Forces, By Value (USD Billion), 2019–2031

Figure 6        United Kingdom Defense Market Share, By Product Type, By Value (USD Billion), 2019–2031

Figure 7        United Kingdom Defense Market Share, By Operation, By Value (USD Billion), 2019–2031

List of Tables

Table 1         United Kingdom Defense Market Size, By Value (USD Billion), 2019–2031  

Table 2         United Kingdom Defense Market Size, By Armed Forces, By Value (USD Billion), 2019–2031 

Table 3         United Kingdom Defense Market Size, By Product Type, By Value (USD Billion), 2019–2031 

Table 4         United Kingdom Defense Market Size, By Operation, By Value (USD Billion), 2019–2031

Table 5         Airbus Company Overview

Table 6         Airbus Financial Overview

Table 7         Babcock International Company Overview

Table 8         Babcock International Financial Overview

Table 9         BAE Systems plc Company Overview

Table 10       BAE Systems plc Financial Overview

Table 11       The Boeing Company - Company Overview

Table 12       The Boeing Company Financial Overview

Table 13       Lockheed Martin Company Overview

Table 14       Lockheed Martin Financial Overview

Table 15       MBDA Company Overview

Table 16       MBDA Financial Overview

Table 17       QinetiQ Company Overview

Table 18       QinetiQ Financial Overview

Table 19       Rolls-Royce Company Overview

Table 20       Rolls-Royce Financial Overview

Table 21       RTX Corporation Company Overview

Table 22       RTX Corporation Financial Overview

Table 23       Thales Company Overview

Table 24       Thales Financial Overview