Jocelyn Bush

Project Manager

Bianca Williams

Market Research

Economic Business Analysis Consulting Services

Engineering Design GrowthInitial Product ProposalAugust 26, 2010

Provide initial suggestions of products for Jabil Design

Services to target based on preliminary results of market

research within Defense and Aerospace market segments

Communicate plan of action to complete the economic

business analysis required

Objective

• Business Case Hypothesis

• Industry Description

• Secondary Research

• Procurement by Segment

• Market Analysis

• Key Players

• Target Market Revenues

• Target Market Customer Count

• Target Product Market

• Product Images

• Preliminary Analysis

• External Factors

• Recommendation

Key Topics

AssumptionsTarget products technically mature

Time to market: by 2012 – 2013

High growth potential for target areas identified byDOD funding allocated in out-years

Correlation to target customer list

Business Case Hypothesis

Defense electronics and military aerospace are also covered by the defense segment; the aerospace segment includes civilian planes and space equipment but excludes military aircraft and related items.

The aerospace and defense

market is deemed to be

revenues accrued by

manufacturers from civil and

military aerospace and

defense procurements. This

only includes equipments,

parts and maintenance

(EPM).

Industry Description

In 2014 the US aerospace and defense market is forecast to have a

value of $413.6 billion, an increase of 12.1% since 2009 with a 5

year CAGR of 2.3%

Market Segmentation I

Defense segments account for 77% of total market value

Market Segmentation II

Aerospace segments account for 49.6% of total market

value

Secondary Research

Secondary Research Cont’d

FY11 Defense Budget Request

$708.2 bn

FY11 Budget Amount for Major Procurement and R&D focus areas: $189bn (60% Procurement, 40% R&D)

Major Procurement and R&D focus areas:

Army Combat Force Modernization Programs ($3.2B procurement)

Launching of the Ground Combat Vehicle (GCV) program

Replacing of the M-1 (Abrams)

Replacing of the M-2 (Bradley)

Navy Force Structure and Ship Building Plans ($15.9B Procurement)

Next Generation Ballistic Missile Submarine SSBN(X) ($7.9B/per Procurement)

Resumed production of DDG-51 Destroyers ($3B/per Procurement)

Ballistic Missile Defense ($8.6B Procurement & R&D)

Aircraft Programs

F-35 ($10.5B Procurement & R&D)

F-35 Alternate Engine ($2.5B R&D)

KC-X ($863.9M R&D)

Military Construction ($18.7B Procurement & R&D)

Procurement by SegmentDefense FY2011 Authorizations and Appropriations (by CRS)

Market Analysis

Revenue Growth Competition Lifecycle Stage

Groundbased

Electronics

HIGH Decline

Network Centric Systems

$6.1bn Growth

Real-Time Communication

$15.6bn 4.8% MEDIUM Mature

Homeland Security

$50bn 12% HIGH Mature

C4ISR $8.8bn 2.3% HIGH Growth

Revise to include:

• Defense / Procurement and R&D Specific data for HLS

• Forward looking

End-user demand for integrated solutions has reached an all-time high as government agencies and private sector security firms are increasingly opting for comprehensive and integrated systems over stand-alone products.

At the macro level, a gradual shift in defense spending patterns can be discerned. In response to the asymmetric terrorist threats, the emphasis appears to have shifted to high-tech intelligence equipment, replacing demand for conventional heavy armor.

Market Analysis

-Zacks Equity Research -Frost & Sullivan

Highest levels of capabilities

AFRL

BAE

Cobham

DRS

Harris

ITT Electronics

General Dynamics

Raytheon

Goodrich

Key Players

Target Market RevenuesBy Customer and Division

Target Market Customer Count

16 7 18 23 15

Target Customer ProductsGround Based Electronics

Target Customer Products Network

Centric Systems and Real-Time Communications

Target Customer Products Homeland

Security

Target Customer Products (cont’d)

Target Customer Products (cont’d)

Least Manufactured Products

Cargo Screeners

Weapon sights for law enforcement

Biometrics

Marine and Power Systems

Most Manufactured Products

Electronic Sensors

Avionics, displays and specialty products

Microwave, RF, SATCOM, and Antenna Products

Sensors, Guidance, Navigation and simulation

Target Product Markets

Product Images

All-Glass Cockpit Smart Multi-Function Display (NGC); Avionics

CEAFAR Minor War Vessel Radar (NGC); Maritime RadarsTransportable Multi-Domain Surveillance System (Raytheon); Homeland Security

Advanced Airborne reconnaissance system (BAE); Sensors

Preliminary Analysis

Updates

Government Standards

-Facility Codes

Current Capabilities

Key Players Internal Procurements

Long Standing Gov't Contracts

Saturated Market

Product Patents

Time for prodcust development

-Technological Capabilities

Research & Development

Aerospace & Defense

Barriers to Entry

Seller Power & Analysis

A & D Companies

Moderate:

Options for Manufacturers

Facility Capabilities

Buyer Power & Analysis

Government Agencies

High:

Substitute Products

Unique Product and services needed

External Factors

Cross reference facility capabilities with government standards for initial overhead costs

Diversify risk by producing both popular and least manufactured products based on capabilities and ROI

Create time table for research & development, product manufacturing and distribution

Secure Government contracts for FY 2012

Recommendation

Questions?