fighter aircraft market projected to grow at 4.1% CAGR; industry players expanding with new technologies and strategic collaborations

The global fighter aircraft market is gearing up for a decade of steady expansion, with new technologies, modernization programs, and international collaborations driving growth. According to the latest report “Fighter Aircraft Market Size and Share Forecast Outlook 2025 to 2035”, the market is valued at USD 52.9 billion in 2025 and is projected to reach USD 79.0 billion by 2035, registering a compound annual growth rate (CAGR) of 4.1%.

The sector has already demonstrated resilience, expanding from USD 43.3 billion in 2021 to USD 52.9 billion in 2025, supported by rising procurement of advanced fighter jets, fleet modernization, and a strong focus on air superiority. Incremental gains are expected to continue, reflecting both early-stage investments and long-term commitments by defense ministries worldwide.

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Growing Market Momentum

From 2025 to 2035, the fighter aircraft industry is expected to unlock a massive absolute dollar opportunity of USD 26.1 billion, with demand accelerating in North America, Asia-Pacific, and Europe. Countries are not only replacing aging fleets but also investing in indigenous aircraft development to strengthen domestic defense capabilities.

The conventional take-off and landing (CTOL) segment remains dominant, holding 75% market share in 2025, thanks to its proven reliability and infrastructure compatibility. On the propulsion front, single-engine fighter aircraft are projected to command 62% of market revenue in 2025, owing to their balance of performance, agility, and cost-effectiveness. Meanwhile, the strike and ground attack segment accounts for 30% of revenue, underscoring the increasing importance of precision engagement in modern warfare.

Why the Market is Growing

The fighter aircraft market is fueled by several interlinked factors:

• Defense Modernization Programs: Nations are aggressively upgrading their fleets with fifth- and sixth-generation aircraft that feature stealth, precision targeting, and advanced avionics.
• Rising Geopolitical Tensions: Regional disputes and global security challenges are prompting countries to expand aerial combat readiness.
• Technological Advancements: AI integration, next-generation propulsion, stealth materials, and network-centric warfare capabilities are reshaping the role of fighter jets.
• Shift Toward Multi-role Fighters: Modern air forces prefer flexible platforms that perform multiple missions with reduced costs and quicker adaptability.

Regional Growth Highlights

The outlook varies across major defense markets, with several countries showing above-average growth rates:

• China: Projected to lead the market with a 5.5% CAGR, driven by heavy investment in defense modernization, indigenous fighter production, and rising regional security concerns.
• India: Expected to grow at 5.1% CAGR, supported by domestic programs such as HAL’s Tejas and international collaborations.
• Germany: Forecasted to expand at 4.7% CAGR, with modernization of the Luftwaffe and participation in Europe’s Future Combat Air System (FCAS).
• United Kingdom: Growth at 3.9% CAGR, boosted by participation in the Tempest sixth-generation fighter program.
• United States: Despite being the largest defense spender, growth is moderate at 3.5% CAGR, anchored by programs like the F-35 Lightning II and Next Generation Air Dominance (NGAD).

Opportunities and Challenges

While modernization and exports are key growth drivers, the fighter aircraft industry faces challenges such as high procurement costs, complex maintenance requirements, and strict regulatory controls on technology transfers. Smaller nations often struggle with affordability, relying on incremental upgrades rather than full fleet replacements.

On the other hand, the sector is witnessing new opportunities through:

• Manned-Unmanned Teaming: Integration of fighter jets with drones for enhanced combat operations.
• Digital Twins & Predictive Maintenance: Reducing lifecycle costs and improving readiness.
• International Partnerships: Collaborative programs spreading costs and accelerating access to next-gen technologies.

Competitive Landscape

Competition is intensifying as both established defense giants and emerging manufacturers aim to secure market share. Players are focusing on innovation, lifecycle upgrades, and cross-border partnerships.

• Lockheed Martin dominates with its F-35 Lightning II program, leveraging global partnerships and sustainment contracts.
• Boeing strengthens its position with the F-15EX and F/A-18 Super Hornet, emphasizing proven performance and upgrade potential.
• Sukhoi offers the Su-35 and Su-57, targeting cost-sensitive markets in Asia and the Middle East.
• Dassault Aviation continues to expand Rafale exports, showcasing multirole adaptability.
• Saab’s Gripen is widely adopted by nations seeking affordability, advanced avionics, and interoperability.
• Chengdu Aircraft Industry Group (CAC) leverages China’s domestic strength and rising international sales with the J-10 and J-20.
• Hindustan Aeronautics Limited (HAL) advances with the Tejas Light Combat Aircraft, aligning with India’s “Make in India” defense strategy.
• Korea Aerospace Industries (KAI) positions its FA-50 and KF-21 for regional defense customers and collaborative programs.

These manufacturers are not only competing on technology but also focusing on affordability, sustainment, and multirole versatility to meet the diverse needs of global defense forces.

Fighter Aircraft Market by Segments

Take-off and Landing Capability:

• Conventional take-off and landing (CTOL)
• Short take-off and vertical landing (STOVL)
• Vertical take-off and landing (VTOL)

Propulsion Type:

• Single-engine fighter aircraft
• Twin-engine fighter aircraft

Application:

• Strike / ground attack
• Electronic warfare (EW)
• Reconnaissance & surveillance
• Air superiority
• Others

Region:

• North America
• USA
• Canada
• Mexico
• Latin America
• Brazil
• Chile
• Rest of Latin America
• Western Europe
• Germany
• UK
• Italy
• Spain
• France
• Nordic
• BENELUX
• Rest of Western Europe
• Eastern Europe
• Russia
• Poland
• Hungary
• Balkan & Baltic
• Rest of Eastern Europe
• East Asia
• China
• Japan
• South Korea
• South Asia and Pacific
• India
• ASEAN
• Australia & New Zealand
• Rest of South Asia and Pacific
• Middle East & Africa
• Kingdom of Saudi Arabia
• Other GCC Countries
• Turkiye
• South Africa
• Other African Union
• Rest of Middle East & Africa

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