UAV/Drone Synthetic Aperture Radar (SAR) Market

UAV SAR funding more than quadrupled over the decade from 2005-2015. Before that, the only major program was RDT&E funding for the large MP-RTIP (Multi-Platform Radar Technology Insertion Program) radar for the Block 40 Global Hawk.

Then, not only did US Air Force MP-RTIP production end prematurely with a truncated eleven-radar procurement, but the Air Force planned to “divest” the entire Block 40 Global Hawk fleet. Most thought this was as unlikely to happen as the USAF threat to mothball the Block 30 fleet. But by mid-2022, all these retirements and divestments were going ahead – with immediate effect, with all Block 30 Global Hawks now retired and MP-RTIP and NATO Alliance Ground Surveillance (AGS) systems likely to remain only moderate programs for another decade or so. But the UAV SAR future remains bright, just with a change of horses and sensors.

Teal Group forecasts total market funding available to US manufacturers will continue to grow steadily over the next decade, from $1.7 billion in FY23 to $2.9 billion in FY32 (a 6.4% CAGR), with a boost in the last three years of our forecast period as production num-bers of classified stealthy systems jumps from FY30 onward for several programs for new US Air Force UCAVs (Unmanned Combat Air Vehicles). The CAGR from FY29 to FY31 will be 29.7%, with funding growing from $1.9 billion to $2.9 billion in just two years.

Other new markets will grow with unclassified radars such as the Northrop Grumman MFAS radar for the Navy’s maritime BAMS MQ-4C Triton (based on Global Hawk), which finally has begun large-scale production, as well as other new near-future maritime and endurance UAVs. Finally, small SARs for tactical and smaller UAVs have been sought for many years and we see development and eventual production of new systems continuing this decade.

The UAV SAR market may be one of the best places to be in ISR sensors for the next decade, but an increasing percentage of the market will be classified systems funded by classified budgets. Thus, Teal Group’s UAV reports in the new Military Radar & Sonar Systems Briefing have more than their share of speculative forecasts. Teal Group has confidence in our UAV SAR market forecasts, as supported by news and documents and contracts discussed throughout the Briefing, but funding may shift somewhat between new and classified programs as the UAV SAR market grows.

In terms of market access, the early UAV SAR market seemed to be offering great opportunities to new firms, with several small developers earning big contracts – General Atomics with its Lynx and Lynx II, Telephonics with the RDR 1700, and Syracuse Research with FORESTER. This seemed incredible and, in fact, it was.

The Army dropped General Atomics’ Lynx II from its Gray Eagle (instead buying Northrop Grumman’s Starlite) as well as its FCS Fire Scout, and Telephonics lost a good program when the Coast Guard dropped the overdue Eagle Eye UAV from Deepwater (Deepwater was later cancelled as well). The Navy also inexplicably chose Northrop Grumman “on a non-competitive basis” to provide a radar (now cancelled) for its MQ-8B VTUAV program.

By mid-2024, we still forecast Northrop Grumman will remain the #1 prime contractor in the UAV SAR market for every year from 2023-2030, with $2.7 billion in unclassified funding.

But as discussed above, the end of MP-RTIP as a major program will see Northrop’s dominance shrink as we forecast huge coming growth in planned and speculative programs that are largely still uncontracted – at least publicly (unclassified). Beginning in FY25, more than 60% of our annual UAV SAR funding forecast is still uncontracted and often still unbudgeted (publicly).

Northrop Grumman should earn a substantial share of this and may also remain the market leader indefinitely in unclassified programs, with continuing Triton MFAS and other system production. But small technology companies like ImSAR could suddenly find themselves at least a moderate player (perhaps before being bought out or passed over), especially for new tactical or small tactical/mini/nano-UAV radars. The major radar firms Lockheed Martin and Raytheon are also likely already involved in the UAV SAR market – for classified programs such as Lockheed’s ASARS-3 for the stealthy RQ-170 – and they should offer major subcontracting opportunities to smaller technology firms.

Note that forecasters who only address current programs of record or only programs already in the five-year FYDP (Future Years Defense Program) will miss many of these future opportunities, when radar firms and suppliers should already be planning. Teal Group includes comprehensive speculative out-years and classified forecasts for all segments of the UAV SAR market in its Briefing.