AVASCENT WHITE PAPER
By Doug Berenson · Sebastian Sobolev · Allison Gibbs · Michael Barber
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Avascent Analytics analyzes the defense spending of 60 countries in its Global Platforms and Systems (GPS) database. The GPS database covers approximately 95 percent of international defense investment spending that is accessible to Western defense suppliers. The database features a comprehensive “topline” forecast of each country’s total defense spending over a 10-year period, as well as a detailed “bottom-up” analysis of its program-by-program plans. Additionally, the Platforms Module of the GPS database captures the current inventory of global defense platforms, including aircraft, ships and ground vehicles for the 58 countries covered. For each platform captured, the Platforms Module details the prime contractor, the first and last year of delivery, the size of the installed base per customer, and the number of units to be acquired over a 10-year forecast.
Avascent Analytics breaks down total defense spending figures for each country into five sub-accounts based on the nature of spending activity: procurement, research and development (R&D), personnel, operations and maintenance (O&M), and pensions. The bottom-up component of the database itemizes the procurement and R&D budgets among an array of individual program plans. These include ongoing programs, announced competitions and planned future acquisitions, as well as Avascent Analytics’ projections of future requirements over the next 10 years, to depict how each country will spend its investment resources over time. Projections are based on multiple factors, including threat perception, mission area gaps, historical investment behavior, industrial base capacity, and other political considerations. Each program or platform acquisition is subsequently disaggregated into its component parts to provide sub-system granularity.
For the budget availability analysis present in this paper, GPS budget data was used to calculate four key performance indicators (KPIs). Avascent’s topline forecast was used to source the size of the 2017 defense budget, to calculate the 2017-2022 defense budget CAGR, and to compute the percentage of total GDP spent on defense. It should be noted that the percentage of total GDP spent on defense figures may differ from commonly published figures due to Avascent Analytics inclusion or exclusion of specific government accounts on a country-by-country basis. The breakdown of total defense spending numbers into the five sub-accounts was used for calculating the percentage of total defense spending allocated to investment (procurement and R&D).
For the platform quality analysis in this paper, the age of airborne, maritime and ground platforms was calculated using the first and last year of delivery in the Platforms Module. The platforms were then divided into airborne, maritime and ground segments to calculate the average age of each segment. For further information on this database, please contact firstname.lastname@example.org.
ABOUT THE AUTHORS
- Doug Berenson is a Managing Director at Avascent. Doug has over twenty years of experience in the defense and aerospace sector with a specialization in macroeconomic, budgetary and programmatic forces shaping global defense and aerospace markets. In addition, Doug leads Avascent Analytics, a provider of rigorous, structured analyses on global defense markets. For more information, contact: email@example.com.
- Sebastian Sobolev is the Deputy Director of Avascent Analytics, where he coordinates the development of a variety of quantitative and qualitative analytic tools that are used to support strategic planners in defense corporations and governments. For more information, contact firstname.lastname@example.org.
- Allison Gibbs is a Senior Market Analyst with Avascent Analytics, where she analyzes international defense spending. Allison specializes in European defense markets, having worked in the European defense industry and in government on European defense policy. For more information, contact email@example.com.
- Michael Barber is an Analysis Manager with Avascent Analytics, where he guides the development, refining and maintenance of Analytics’ suite of products. Additionally, Michael assists with Avascent’s in-depth representation of the US DoD budget. For more information, contact: firstname.lastname@example.org.
Country Contributions from
- Michael Barber (France) – email@example.com
- Jessica DiPaolo (Poland) – firstname.lastname@example.org
- Allison Gibbs (Germany) – email@example.com
- Aaron Lin (Australia, Japan, the Philippines) – firstname.lastname@example.org
- Christopher Yee-Paulson (Taiwan, UK) – email@example.com
- Daniel Yoon (South Korea) – firstname.lastname@example.org
Additional Editorial Insights from
- Matthew Caris • August Cole • Dominik Kimla • Julien Demotes-Mainard • Lars Miethke • Matthew Vallone • Joseph Walsh
Avascent is the leading strategy and management consulting firm serving clients operating in government-driven markets. Working with corporate leaders and financial investors, Avascent delivers sophisticated, fact-based solutions in the areas of strategic growth, value capture, and mergers and acquisition support. With deep sector expertise, analytically rigorous consulting methodologies, and a uniquely flexible service model, Avascent provides clients with the insights and advice they need to succeed in dynamic customer environments.