Land-based Military Electro-optical and Infrared Systems Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Land-based Military Electro-optical and Infrared Systems Market Analysis

The Land-based Military Electro-optical And Infrared Systems Market size is estimated at USD 1.66 billion in 2025, and is expected to reach USD 1.93 billion by 2030, at a CAGR of 3.05% during the forecast period (2025-2030).

The land-based military electro-optical and infrared systems industry is experiencing significant transformation driven by increasing global security concerns and technological advancements. Global military expenditure reached USD 2,240 billion in 2022, representing a 6% growth from 2021, reflecting the growing investment in advanced defense capabilities. Military forces worldwide are increasingly focusing on enhancing their combat effectiveness through advanced optronic systems that provide superior situational awareness and target acquisition capabilities. The integration of thermal imaging, panoramic vision, and enhanced driver vision capabilities has become essential for modern military operations, particularly in challenging environmental conditions.

The industry is witnessing a notable shift towards unmanned and autonomous systems integration with advanced EO/IR capabilities. Military organizations are increasingly investing in unmanned ground vehicles (UGVs) equipped with sophisticated electro-optical sensors for reconnaissance and surveillance missions. The development of next-generation combat vehicles with reduced crew requirements and enhanced autonomous capabilities is driving innovation in sensor technologies. These systems are being designed to operate effectively in diverse environmental conditions, providing military forces with improved tactical advantages while reducing risk to personnel.

Vehicle modernization programs are emerging as a significant trend across major military powers, with a focus on upgrading existing platforms with advanced EO/IR systems. The US Army's ambitious modernization efforts include plans to procure over 49,000 vehicles of various configurations, all requiring advanced electro-optical and infrared systems for enhanced operational capabilities. Military forces are increasingly demanding integrated solutions that combine multiple sensor technologies, including thermal imagers, day/night cameras, and laser rangefinders, to provide comprehensive battlefield awareness and targeting capabilities.

Recent technological developments have focused on improving the integration and effectiveness of EO/IR systems in military platforms. Advanced sensor suites are being developed with enhanced capabilities in target detection, recognition, and identification across varying environmental conditions. The industry is witnessing increased emphasis on developing systems with improved size, weight, and power (SWaP) characteristics, while maintaining or enhancing performance capabilities. These advancements are enabling military forces to operate more effectively in complex battlefield environments, with improved ability to detect, track, and engage threats under all weather conditions and lighting scenarios.

Land-based Military Electro-optical and Infrared Systems Market Trends

Rising Defense Expenditures

The profound changes in the international strategic landscape have led to significant increases in global military spending, driven by growing hegemonism, unilateralism, and power politics that have fueled several ongoing global conflicts. The configuration of the international security system has been undermined by these factors, compelling nations to enhance their military capabilities and ISR systems. Uncertainties in territorial rights between many countries, like the Saudi-Iran tensions in the Middle East, are among the major causes disturbing the geopolitical climate, leading governments to increase military spending to improve their security situation.

Military powerhouses have been focusing intensively on augmenting their military firepower and ISR capabilities through increased defense budgets. According to the Stockholm International Peace Research Institute (SIPRI), the United States, China, India, Russia, and Saudi Arabia had the highest military expenditures globally, accounting for 62% of the global expenditure. This increased spending has directly translated into procurement programs aimed at enhancing the situational awareness of armed forces, particularly in the domain of military surveillance systems and military targeting systems for land-based platforms.

Military Modernization and Advanced Technology Integration

Advanced optronic systems have become essential components in enhancing armored vehicles' combat effectiveness, with military forces worldwide focusing on thermal imaging, 360-degree vision, and enhanced night vision capabilities for both land vehicles and dismounted infantrymen. The integration of cutting-edge technologies is evidenced by recent major contracts, such as the September 2023 US Army award to Kongsberg worth USD 94 million for 409 Commonly Remotely Operated Weapon Stations (CROWS), featuring advanced day cameras, thermal imagers, and laser range finders with fire-on-the-move capabilities. Similarly, in July 2023, the US Army awarded a USD 117.5 million contract to RTX Corporation for 3rd Generation Forward Looking Infrared (3GEN FLIR) B-Kit sensors, demonstrating the military's commitment to advancing their optical capabilities.

The modernization of Remote Weapon Systems (RWS) has seen significant technological advancement with the incorporation of sophisticated features like automatic target tracking, laser range finder for accurate ballistics, last-round warning, and manual backup capabilities. These developments are complemented by the integration of advanced vehicle protection systems, where manufacturers are developing sensors that provide expanded visibility, enhanced situational awareness, and improved threat warning capabilities to military armored vehicles and crews. The trend is further exemplified by the US Army's initiative to procure Microsoft's militarized HoloLens 2 augmented reality system, announced in March 2022, showcasing the military's commitment to incorporating cutting-edge visualization technologies for enhanced combat effectiveness, including military imaging systems and military night vision systems.

Segment Analysis: Type

Vehicle Mounted Segment in Land-based Military EO/IR Systems Market

The vehicle-mounted segment dominates the land-based military electro-optical and infrared systems market, accounting for approximately 86% of the total market share in 2024. This segment's prominence is driven by the increasing integration of advanced optronic systems to enhance armored vehicles' combat effectiveness. The segment encompasses various technologies, including thermal imaging, 360-degree vision capabilities, and enhanced military night vision systems that are essential for modern military operations. Vehicle-mounted EO/IR systems have become crucial components in modern military vehicles, providing expanded visibility, situational awareness, and threat warning capabilities to military armored vehicles and crews. These systems typically include high-definition uncooled cameras, extended-view multifunction capabilities, and sophisticated sensor suites that can operate effectively in adverse weather conditions, both during day and night operations. The integration of these systems with remote weapon stations (RWS) and other vehicle defense systems has further solidified their importance in modern military operations.

Man Portable Segment in Land-based Military EO/IR Systems Market

The man-portable segment of the land-based military electro-optical and infrared systems market represents a critical component of modern infantry operations. These systems are primarily utilized in perimeter security, surveillance, force protection, and short to mid-range threat detection, tracking, and targeting, as well as training and testing applications. The segment's growth is driven by technological advancements in reducing the size and weight of EO/IR equipment while maintaining high-performance capabilities. Modern man-portable systems are being developed with enhanced features such as adjustable diopters, manual gain adjustment, individually rotating monocular capabilities, and integrated infrared illuminators. The integration of multiple systems into single units, coupled with ongoing efforts to improve battery capacity and reduce overall system weight, continues to drive innovation in this segment. These developments are particularly focused on addressing the challenges of battery life, weight, and size of the equipment, which remain crucial factors in determining the effectiveness of man-portable military imaging systems in field operations.

Land-based Military Electro-optical And Infrared Systems Market Geography Segment Analysis

Land-based Military Electro-optical and Infrared Systems Market in North America

North America represents a dominant force in the land-based military electro-optical and infrared systems market, driven by substantial defense modernization programs and technological advancements. The region's market is characterized by significant investments in next-generation combat vehicles, soldier modernization programs, and enhanced surveillance capabilities. The United States and Canada are the key contributors to the regional market, with both countries focusing on upgrading their existing military platforms with advanced EO/IR systems. The presence of major defense contractors and continuous research and development activities further strengthens the region's market position.

Land-based Military Electro-optical and Infrared Systems Market in the United States

The United States maintains its position as the largest market in North America, commanding approximately 86% of the regional market share in 2024. The country's dominance is attributed to its extensive military modernization initiatives and substantial defense budget allocations. The U.S. Army's focus on enhancing its combat vehicle capabilities through programs like the Next Generation Combat Vehicle (NGCV) and Optionally Manned Fighting Vehicle (OMFV) continues to drive market growth. The integration of advanced EO/IR systems in various platforms, from main battle tanks to infantry fighting vehicles, demonstrates the country's commitment to maintaining technological superiority in land warfare. The adoption of military surveillance systems and military targeting systems further underlines the strategic advancements in the U.S. defense sector.

Land-based Military Electro-optical and Infrared Systems Market Growth in the United States

The United States is also experiencing the highest growth rate in North America, with a projected CAGR of approximately 3% during 2024-2029. This growth is fueled by ongoing military modernization programs and increasing adoption of advanced targeting and surveillance systems. The U.S. military's emphasis on enhancing night vision capabilities, thermal imaging systems, and integrated vehicle protection systems continues to drive market expansion. The development of multi-function EO/IR systems and their integration with artificial intelligence and machine learning technologies further supports this growth trajectory. The focus on military night vision systems and military imaging systems is pivotal in maintaining the technological edge.