Avionics Market to Reach USD 156 Billion by 2035, Driven by Aircraft Electrification and Rising Demand for Advanced Flight Systems | TMR

Global avionics market is anticipated to demonstrate significant expansion over the next decade. The market, valued at US$ 69.8 billion in 2024, is expected to grow to US$ 156.0 billion by 2035, registering a CAGR of 7.7% between 2025 and 2035. This growth is attributed to the widespread adoption of aircraft electrification technologies, a surge in both commercial and military aircraft production, and the continuous evolution of next-generation aviation systems.

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Market Highlights
The avionics market is demonstrating a steady upward trajectory, driven by the increasing integration of sophisticated electronics into modern aircraft systems. In 2024, the market stood at US$ 69.8 billion and is forecasted to more than double by 2035, signifying the growing dependence on advanced avionics for navigation, safety, and automation.

North America accounted for 34% of the global revenue share in 2024, maintaining its dominance due to its strong aerospace ecosystem, extensive R&D infrastructure, and the presence of leading avionics manufacturers. The Mission & Tactical Systems segment led the market with a 36% share, underscoring the heightened focus on defense modernization and intelligence-driven flight operations.

Prominent companies such as Honeywell International Inc., Collins Aerospace, Thales Group, and Garmin Ltd. continue to play a pivotal role by delivering cutting-edge avionics solutions that cater to evolving regulatory standards and safety mandates.

Key Market Drivers
The momentum in the avionics industry is primarily influenced by the advancement in aircraft electrification and the global expansion of commercial and military fleets. These factors collectively strengthen the demand for integrated systems that enhance operational efficiency, improve pilot situational awareness, and ensure real-time data management for flight control and navigation.

Aircraft electrification is redefining the future of air travel by enabling more sustainable, efficient, and intelligent propulsion technologies. The transition from conventional mechanical systems to fully or partially electric configurations introduces significant opportunities for the avionics sector. Modern electric aircraft now require systems capable of managing complex power distribution, propulsion control, and energy optimization. Additionally, innovations in electric vertical takeoff and landing (eVTOL) and urban air mobility (UAM) platforms demand lightweight, modular avionics that facilitate autonomous operations and real-time communication with air traffic systems.

The increasing demand for commercial and defense aircraft worldwide further propels market expansion. Rising air passenger volumes in emerging markets such as Asia-Pacific, alongside fleet modernization initiatives in developed regions, are prompting both OEMs and aftermarket suppliers to enhance their avionics offerings. Military programs emphasizing mission-readiness, situational awareness, and digital communication are similarly accelerating adoption. Regulatory mandates by the FAA and EASA requiring avionics upgrades for compliance and safety assurance also serve as a vital growth catalyst.

Segment Insights
The Mission & Tactical Systems segment dominates the global avionics market, accounting for 36% of total revenues in 2024. These systems are essential for executing advanced operational tasks in both civil and defense aviation, encompassing mission planning, real-time data analysis, target acquisition, and electronic warfare. The rising complexity of modern warfare and the need for secure, networked communication have prompted defense agencies to increasingly adopt integrated mission systems that improve decision-making speed and accuracy.

Beyond defense applications, advancements in communication, navigation, and surveillance systems have also strengthened the integration of avionics into commercial and unmanned platforms. Airlines are investing heavily in retrofitting older fleets with upgraded avionics for compliance with evolving safety and efficiency standards. Likewise, the growing fleet of UAVs and drones equipped with compact and high-performance avionics systems is creating new opportunities within the market.

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Regional Outlook
North America maintained its leadership in the global avionics market, holding a 34% revenue share in 2024. The region's dominance can be attributed to its robust aerospace infrastructure, extensive R&D investment, and strong government support for aviation innovation. Programs initiated by NASA and the U.S. Department of Defense continue to drive advancements in avionics technologies for both commercial and defense applications.

Furthermore, the Federal Aviation Administration's (FAA) NextGen air traffic modernization initiative has accelerated the demand for upgraded avionics to ensure seamless communication, navigation, and surveillance capabilities across the national airspace. The region's thriving network of aerospace manufacturers and suppliers, combined with stringent regulatory standards, reinforces its competitive advantage in avionics production and innovation.

Meanwhile, Asia-Pacific is projected to register the fastest growth rate over the forecast period. The increasing number of air passengers, indigenous aircraft programs in China and India, and regional investments in UAV technology are fostering rapid market expansion. Europe, supported by established aerospace leaders such as Airbus and Thales, also remains a significant contributor to global market revenues.

Recent Industry Developments

In July 2025, BAE Systems announced a partnership with L3Harris Technologies to support the conversion of two Gulfstream G550 aircraft into advanced electronic attack platforms for the Italian Air Force, under a US$ 12 million contract. This initiative underscores the growing integration of mission-specific avionics for military modernization programs.

In May 2025, Trig Avionics joined the Dynon Group through a strategic investment, uniting two major European avionics manufacturers to deliver a comprehensive range of products including transponders, flight displays, and integrated cockpit solutions. Such collaborations reflect the industry's trend toward consolidation and innovation aimed at meeting the increasing demand for modular, digitalized avionics systems.

Leading Market Participants
Key players in the global avionics market include BAE System PLC, Honeywell International Inc., Collins Aerospace, Thales Group, Garmin Ltd., Universal Avionics, Lufthansa Technik, Safran S.A, Meggitt Ltd., Teledyne Technologies Incorporated, and L3Harris Technologies Incorporated. These companies are actively investing in strategic partnerships, technological innovation, and portfolio diversification to strengthen their positions in both defense and civil aviation sectors. Their focus on developing AI-driven, cyber-secure, and software-defined avionics systems ensures alignment with the aviation industry's transition toward digital transformation.

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Analysts' Viewpoint
Industry analysts project a sustained growth trajectory for the avionics market, highlighting the ongoing shift toward digitalization, automation, and intelligent system integration. The increasing reliance on AI, augmented reality (AR), and machine learning algorithms is transforming the way avionics systems are designed and utilized. Moreover, as electric and autonomous aircraft platforms continue to evolve, avionics will play a central role in enabling data-centric, predictive, and adaptive flight management systems.

The long-term outlook remains optimistic as both commercial airlines and defense organizations prioritize avionics modernization to improve operational safety, reduce maintenance costs, and enhance overall flight efficiency. Emerging trends such as urban air mobility, next-generation UAVs, and fully electric aircraft are expected to further expand the market's potential, making avionics one of the most dynamic and strategically vital segments in the aerospace industry.

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