AI and Robotics in Aerospace and Defense Market – By Component, By Deployment, By End-user & Forecast, 2025 – 2034

AI and Robotics in Aerospace and Defense Market Size

The global AI and robotics in aerospace and defense market was valued at USD 32.5 billion in 2024 and is estimated to grow at a CAGR of 7.7% from 2025 to 2034.
 

Artificial intelligence (AI) advancements have significantly enhanced the autonomy of aerospace systems, particularly unmanned aerial vehicles (UAVs) and autonomous aircraft. AI technologies, including machine learning, computer vision, and sensor fusion, enable aerospace systems to operate with increased precision, reliability, and decision-making capabilities without human intervention. For instance, Anthropic AI has announced a partnership with Palantir and Amazon Web Services (AWS) to provide its Claude AI models to U.S. intelligence and defense agencies. The collaboration will leverage Palantir's data analytics tools to process large datasets, enabling faster insights and pattern recognition for government operations.
 

The defense sector is witnessing a significant increase in investments for developing advanced military robotics and defense technologies. For instance, The U.S. Army is testing a "robot dog" in the Middle East, equipped with an AI-driven gun turret. The system is designed as a counter-drone measure, helping military personnel to defend against aerial threats with autonomous, precision-based responses. This growth is driven by rising geopolitical tensions, a shift toward automation in warfare, and the need for enhanced military capabilities.
 

Robotics integrated with AI and machine learning technologies are being deployed in various defense applications, including autonomous ground vehicles, drones, and robotic systems for reconnaissance, surveillance, and combat. These systems offer considerable advantages in precision, speed, and operational flexibility, while reducing human casualties and improving mission effectiveness. Governments and defense contractors are allocating substantial funding to develop next-generation robotic systems, positioning this market for rapid expansion in both defense and aerospace industries.
 

AI and Robotics in Aerospace and Defense Market Trends

The aerospace and defense sectors are experiencing a shift towards digitalization and smart technologies, with a focus on AI, IoT, and big data analytics integration. These technologies enhance operational efficiency, streamline maintenance, and improve mission planning. AI and data analytics drive predictive maintenance, enabling real-time equipment health monitoring, which reduces downtime and extends asset lifespan. AI-powered systems are also being implemented for more accurate and efficient decision-making in critical scenarios. As defense missions become more complex, AI tools assist military personnel in making faster, more informed decisions for autonomous drones, surveillance, and combat operations.
 

For instance, U.S. defense startup Anduril has introduced its AI-powered Bolt drones for the U.S. Marine Corps, part of the Force Design modernization program. The drones, which include a lethal precision firepower model, are man-packable and feature vertical takeoff and landing (VTOL) capabilities. This technological shift is reshaping the market, with companies and governments prioritizing innovation to maintain competitiveness in both aerospace and defense industries.
 

An emerging trend in the aerospace and defense market is the increased demand for unmanned systems and autonomous vehicles. Military forces are adopting UAVs, UGVs, and USVs for surveillance, reconnaissance, and logistical support. For instance, India has secured a $3.99 billion deal to acquire 31 MQ-9B Predator drones from General Atomics. This acquisition, part of India's defense modernization, strengthens its intelligence, surveillance, and reconnaissance (ISR) capabilities and deepens the strategic partnership with the U.S. These systems offer strategic advantages, including enhanced operational reach, reduced personnel risk, and the ability to execute complex missions in challenging environments.
 

In the commercial sector, drones are being utilized for various applications, from delivery services to infrastructure inspection. Autonomous vehicles, including self-piloting aircraft, are expected to significantly impact both commercial aviation and space sectors. The demand for autonomy in aerospace systems is driven by the need for cost reductions, increased safety, and enhanced mission flexibility. The growing deployment of autonomous systems is influencing the future of military operations, logistics, and commercial air travel.
 

AI and Robotics in Aerospace and Defense Market Analysis

The market faces constraints due to high costs associated with research, development, and integration of advanced technologies. However, significant opportunities are emerging with increasing demand for autonomous drones, AI-powered military robots, and advanced surveillance systems, which enhance operational efficiency. Regulatory challenges, including safety standards, data protection laws, and compliance with defense regulations, may impede market growth. Nevertheless, evolving defense policies and international collaborations are helping to mitigate these barriers.
 

Based on component, the market is segmented into hardware, software, and services. In 2024, the hardware segment accounted for the largest market share with 46.7% share.
 

In the hardware component of the AI and robotics in aerospace and defense industry, advancements in sensors, processors, and actuators are crucial for the development of autonomous systems. These components enable precise data collection, real-time decision-making, and enhanced maneuverability in drones, robots, and other unmanned vehicles. High-performance AI chips and edge computing devices are also driving innovation, allowing for faster data processing and reducing latency in mission-critical applications.
 

The hardware segment faces challenges related to miniaturization, power efficiency, and environmental resilience. As AI and robotic systems are deployed in harsh conditions such as space missions or combat zones hardware must be robust, durable, and energy-efficient. Innovations in battery technology, lightweight materials, and high-performance computing hardware are helping meet these demands, with companies increasingly investing in specialized components that ensure reliability and longevity in extreme aerospace and defense environments.
 

Based on deployment, the market is divided into near to airborne systems, ground-based systems, space-based systems, naval-based systems. In 2024, the space-based systems segment is the fastest-growing segment with a CAGR of 10.4% during the forecast period.
 

Space-based systems are becoming an important segment in the AI and Robotics in Aerospace and Defense market, particularly for surveillance, communication, and navigation. These systems use AI for real-time data analysis, anomaly detection, and autonomous decision-making, which is essential for missions in remote or hostile environments. Robotics integrated into satellites and space exploration vehicles also improves operational efficiency, enabling tasks such as satellite maintenance, resource collection, and planetary exploration.
 

The growth of space-based AI systems is driven by advancements in satellite autonomy and robotic servicing technologies. As space missions become more complex, AI-powered robotics offer increased autonomy for planetary exploration, reducing the need for human intervention. These systems also play a significant role in space debris management and in-orbit repairs, as they can identify and address issues more quickly than traditional methods. With increasing private sector involvement in space, the demand for more advanced, AI-driven space-based systems is expected to grow.
 

In 2024, the North America AI and robotics in aerospace and defense market held the largest share of 34.5%, and it is predicted that it will hold its dominant position throughout the forecast period. North America, led by the United States, is experiencing substantial growth in the AI and robotics market for aerospace and defense. This expansion is primarily driven by increased investments in autonomous defense systems, AI-enhanced surveillance, and military robotics applications. U.S. government agencies, notably the Department of Defense, are prioritizing technological advancements to enhance and modernize defense capabilities. The market is further strengthened by strategic partnerships with defense contractors, which promote innovation in AI and robotic systems for aerospace operations.
 

China is expanding its presence in global market, focusing on autonomous military systems, drones, and AI-driven surveillance technologies. The government invests in advanced AI research and robotic development to enhance defense capabilities. China's space program uses AI for space exploration, satellite operations, and autonomous systems, aiming to improve operational efficiency in defense and commercial aerospace applications.
 

Germany market focuses on integrating robotics and AI in aerospace and defense, particularly in autonomous aircraft systems and defense robotics. Aerospace companies collaborate with government agencies to develop AI-powered drones, robotic vehicles, and advanced surveillance systems. Germany's industrial base in engineering and automation supports innovation in AI and robotics, contributing to advancements in military and commercial aerospace technologies.
 

Japan AI and robotics in aerospace and defense industry has invested significantly in AI-powered robotics for aerospace and defense, particularly in autonomous drones, satellite technology, and space exploration missions. The country's manufacturing capabilities support the development of AI-driven systems for military logistics, reconnaissance, and surveillance. Japan's defense agencies are exploring robotic systems to enhance security in terrestrial and space domains, aligning with its broader push to advance autonomous systems in aerospace technologies.
 

South Korea AI and robotics in aerospace and defense market focuses on AI and robotics to modernize its defense capabilities, especially in autonomous unmanned aerial systems (UAS) and robotic vehicles for reconnaissance and surveillance. The aerospace sector integrates AI technologies into space missions and defense systems, including AI-driven satellites and military drones. South Korea's emphasis on technology and research collaboration in AI and robotics is accelerating advancements in commercial and defense applications.
 

AI and Robotics in Aerospace and Defense Market Share

Lockheed Martin Corporation integrates AI and robotics in aerospace and defense applications, focusing on autonomous systems, surveillance drones, and AI-powered defense technologies. The company advances robotic solutions for military operations, space exploration, and aviation technologies. Airbus SE applies AI and automation to enhance aircraft systems, space missions, and safety features, including AI-driven aircraft diagnostics and autonomous flight systems. IBM Corporation leverages AI and cloud technologies for military logistics, data analysis, and predictive maintenance in aerospace and defense, enhancing autonomous decision-making and operational efficiency.
 

AI and Robotics in Aerospace and Defense Market Companies

Major players operating in the AI and robotics in aerospace and defense industry are:

• Airbus SE
• Bae Systems
• GE Aviation
• General Dynamics Corporation
• Honeywell International Inc.
• IBM Corporation
• Intel Corporation
• Iris Automation Inc.
• L3 Harris Technologies
• Leonardo S.p.A.
• Lockheed Martin Corporation
• Microsoft
• Northrop Grumman Corporation
• Nvidia Corporation
• Raytheon Technologies Corporation
• Rheinmatall AG
• SAAB AB
• Safran SA
• Sheild AI
• SITA
• Thales Group
• The Boeing Company
   

AI and Robotics in Aerospace and Defense Industry News

• In July 2024, Lockheed Martin was awarded a contract by DARPA for the artificial intelligence reinforcements (AIR) program. The program focuses on developing AI tools to enhance airborne tactical autonomy for dynamic missions. It aims to improve modeling and simulation (M&S) approaches and deploy AI agents for multi-ship, beyond visual range (BVR) missions, advancing the capabilities of autonomous airborne operations.
   
• In June 2024, Airbus Defence and Space and Helsing signed a cooperation agreement at the ILA aerospace trade show in Berlin. The partnership will focus on developing AI technologies for a future Wingman system, an unmanned fighter aircraft that will operate alongside current combat jets like the Eurofighter, receiving tasks from a pilot in a command aircraft.
   

This AI and Robotics in Aerospace and Defense market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD million) from 2021 to 2034, for the following segments:

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Market, By Component

• Hardware
• Software
• Services

Market, By Deployment

• Airborne systems
• Ground-based systems
• Space-based systems
• Naval-based systems

Market, By End-user

• Government/Military
• Commercial
• Space agencies and research institutes

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Australia 
• Latin America
  • Brazil
  • Mexico 
• MEA
  • UAE
  • Saudi Arabia
  • South Africa