Asia Pacific Armored Fighting Vehicle Market By Type (Armored Personnel Carriers (APCs), Combat Support Vehicles, Infantry Fighting Vehicles (IFVs), Main Battle Tanks (MBTs), Reconnaissance Vehicles, Self-Propelled Artillery), By Vehicle (Tracked, Wheeled), By Application (Defense, Homeland Security), By Country, Competition, Forecast & Opportunities, 2020-2030F

Market Overview

Asia Pacific Armored Fighting Vehicle Market was valued at USD 5.2 Billion in 2024 and is expected to reach USD 7.3 Billion by 2030 with a CAGR of 5.7% during the forecast period. The Asia Pacific Armored Fighting Vehicle (AFV) market is experiencing significant growth, fueled by the rising defense budgets across various countries in the region. As regional security concerns continue to grow, there is a higher demand for modernized military vehicles capable of meeting the complexities of modern warfare. Countries are actively investing in the procurement and development of more advanced armored fighting vehicles, leading to increased production and technological improvements in the industry. For instance, According to SIPRI, worldwide defence spending hit a record high of USD 2.443 trillion in 2023 marking the steepest annual increase in over a decade at 6.8% growth. Military expenditure rose across all five continents for the first time since 2009, with defence budgets now consuming 2.3% of global GDP and averaging USD 306 per person globally.

Market Drivers

Increasing Defense Budgets

Rising defense budgets in the Asia Pacific region are a key driver for the growth of the armored fighting vehicle market. As countries focus on improving national security and military preparedness, significant financial resources are allocated to enhance defense infrastructure. Modernizing armed forces with the latest armored vehicles ensures that military personnel are equipped to face contemporary threats effectively. The increased spending also supports the development and procurement of advanced technologies, improving the overall capability of defense forces. For instance, from 2018 to 2022, the Asia-Pacific region made up 41% of the world’s arms imports, driven by rising tensions and territorial disputes. In East Asia, arms imports surged by 21%, with Japan and South Korea showing the most significant increases 171% and 61% respectively making the region a hotspot for military procurement.

Technological Advancements

Technological innovation is at the forefront of the AFV market, with countries in Asia Pacific prioritizing the integration of cutting-edge technologies in their defense vehicles. Advances in automation, fire control systems, and armor materials are enabling AFVs to become more effective in battle. This shift towards high-tech systems increases the demand for advanced vehicles that can perform various roles, from combat to reconnaissance, and enhances the operational capabilities of armed forces. The continuous development of smarter and more efficient AFVs is a crucial factor in the market's growth.

Geopolitical Instability

Ongoing geopolitical tensions and territorial disputes in the Asia Pacific region are significant drivers for the demand for armored fighting vehicles. Nations in the region are prioritizing military readiness, focusing on fortifying their borders and strengthening defense forces. As threats from neighboring countries rise, the need for versatile and reliable armored vehicles that provide tactical advantages on the battlefield becomes more pronounced. The strategic importance of securing national interests has increased the urgency for countries to enhance their military capabilities.

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Key Market Challenges

High Cost of Advanced Technologies

The incorporation of advanced technologies in armored fighting vehicles poses a significant challenge due to the high costs involved. The development and deployment of cutting-edge features, such as autonomous systems, enhanced armor, and advanced weaponry, require substantial investments. These high costs can limit the affordability of AFVs for countries with smaller defense budgets, hindering the widespread adoption of these advanced systems. Financial constraints may slow down the procurement of new vehicles, affecting military readiness and operational capabilities.

Maintenance and Lifecycle Costs

Maintaining and ensuring the operational effectiveness of armored vehicles is another challenge facing the Asia Pacific market. AFVs are built for long-term service, and their upkeep requires significant financial resources. The maintenance costs are often high due to the complex systems in modern AFVs, including electronics, communication systems, and advanced weapons. Ensuring these vehicles remain functional throughout their service life, with required upgrades, places a strain on defense budgets, especially for nations with limited resources. 

Key Market Trends

Shift Towards Autonomous Vehicles

There is a growing trend toward the development and adoption of autonomous armored vehicles in the Asia Pacific market. As military forces seek to reduce reliance on human operators in hazardous environments, autonomous vehicles are seen as a promising solution. These vehicles are equipped with artificial intelligence (AI) and machine learning capabilities that allow them to operate with minimal human intervention. The shift toward autonomy can improve the efficiency and safety of military operations, particularly in high-risk zones, and is expected to drive future growth in the AFV market.

Increasing Focus on Cybersecurity

As armored vehicles become more technologically advanced, cybersecurity is becoming a critical concern in the Asia Pacific region. AFVs are increasingly reliant on digital systems for navigation, communication, and weaponry, making them vulnerable to cyber threats. Ensuring the security of these systems is essential to prevent hacking, data breaches, and interference during combat operations. With the rise of cyber warfare, military forces are placing a greater emphasis on strengthening the cybersecurity of their AFVs to safeguard against potential cyber-attacks that could compromise their operations.

Customization and Modular Designs

The demand for customizable and modular armored vehicles is on the rise, as militaries seek greater flexibility in their vehicle fleets. Modular designs allow for easier upgrades and modifications, enabling vehicles to be adapted for a wide range of roles and mission types. This trend is driven by the need to tailor vehicles to specific operational environments, whether for urban warfare, peacekeeping missions, or reconnaissance. Customizable vehicles offer better resource allocation, ensuring that military forces can meet diverse combat and support requirements.

Segmental Insights

Type Insights

Asia Pacific Armored Fighting Vehicle market includes various vehicle types, each serving distinct roles in military operations. Armored Personnel Carriers (APCs) transport troops with protection and mobility, especially in urban and rugged terrains. Combat Support Vehicles (CSVs) offer fire support, reconnaissance, and battlefield management beyond basic transport. Infantry Fighting Vehicles (IFVs) combine troop transport with heavy armor and weapons for frontline combat. Main Battle Tanks (MBTs) are heavily armored and armed for direct engagements, serving as the core of offensive operations.

Reconnaissance Vehicles focus on speed and surveillance, supporting intelligence gathering and tactical planning. Self-Propelled Artillery delivers mobile heavy firepower, enhancing flexibility on the battlefield. Each type addresses specific operational needs, and rising defense demands continue to drive innovation and procurement across all categories.

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Country Insights

In 2024, China led the Asia-Pacific armored fighting vehicle market due to large-scale military modernization and high defense spending. The country focused on developing and deploying a wide range of armored platforms including main battle tanks, infantry fighting vehicles, and self-propelled artillery. Emphasis on self-reliance in defense production, backed by strong R&D, allowed for rapid upgrades and integration of advanced technologies like active protection systems and unmanned turrets. China's vast terrain prompted the need for diverse vehicle types, including amphibious platforms for coastal defense. Its expanding fleet and frequent military exercises reinforced the country’s dominant position in the region. For instance, in 2024, the United States and China were responsible for 50% of total global military expenditure. The U.S. spent USD 916 billion, up 2.3% from 2023, while China spent $296 billion, reflecting a 6% annual increase and a 60% jump over the decade’s average. Both nations are central drivers of the global arms race.

India followed with growing demand driven by border tensions and internal security needs. Modernization of outdated fleets and support for indigenous manufacturing have boosted the development of armored personnel carriers and infantry vehicles. Programs are tailored to meet the requirements of challenging terrains like deserts and mountains. Local production and partnerships continue to push India toward becoming a significant player in the armored vehicle segment. For instance, Between 2019 and 2023, India was the top arms importer, accounting for 9.8% of global imports, and maintained its position as the third-largest military spender globally. In FY 2023–24, its defence budget rose by 13% to USD 72.6 billion, with continued diversification of arms suppliers beyond its key partner, Russia.

Japan focused on mobility and rapid deployment, investing in lighter wheeled armored vehicles suited for island defense and urban warfare. The country’s shift toward a more proactive defense strategy led to targeted procurement for agile, transportable units capable of quick response across its remote territories.

Recent Developments

• ​India (March 2025): The Ministry of Defence signed INR 2,500 crore contracts for the Nag Missile System (Tracked) and 5,000 light military vehicles to boost anti-tank capabilities and mobility. Awarded under ‘Buy (Indian-IDDM)’, the deals support Aatmanirbhar Bharat and local manufacturing.
• China (March 2025): China is developing a next-gen amphibious IFV with an unmanned turret, active protection system, and 30mm autocannon to replace the Type 05, enhancing coastal combat readiness.
• Japan (March 2024): Japan plans to procure 24 Type-16-based combat vehicles and 8 mortar carriers by 2028, with a USD 218 million budget, enhancing anti-tank and support capabilities.
• In January 2025, Burkina Faso’s military junta received a major shipment of over 100 Chinese-made armoured vehicles, including 50 CS/VP14 mine-resistant MRAPs, significantly strengthening its ground forces amid intensifying jihadist threats in the Sahel region.

Key Market Players

• Ashok Leyland Defence Systems
• China North Industries Group Corporation (NORINCO)
• Defence Research and Development Organisation (DRDO)
• Doosan DST
• Hanwa Techwin
• Korea Aerospace Industries (KAI)
• Mahindra Defence Systems
• Mitsubishi Heavy Industries
• Samsung Techwin
• Tata Motors

Report Scope:

In this report, the Asia Pacific Armored Fighting Vehicle Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

·          Asia Pacific Armored Fighting Vehicle Market, By Type:

o   Armored Personnel Carriers (APCs)

o   Combat Support Vehicles

o   Infantry Fighting Vehicles (IFVs)

o   Main Battle Tanks (MBTs)

o   Reconnaissance Vehicles

o   Self-Propelled Artillery

·         Asia Pacific Armored Fighting Vehicle Market, By Vehicle:

o   Tracked

o   Wheeled

·         Asia Pacific Armored Fighting Vehicle Market, By Application:

o   Defense

o   Homeland Security

·         Asia Pacific Armored Fighting Vehicle Market, By Country:

o   China

o   India

o   Japan

o   South Korea

o   Thailand

o   Indonesia

o   Australia

o   Rest of Asia Pacific

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the Asia Pacific Armored Fighting Vehicle Market.

Available Customizations:

Asia Pacific Armored Fighting Vehicle Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

·         Detailed analysis and profiling of additional market players (up to five).

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