Norway - Defense and Aerospace TechnologiesNorway - Defense/Aerospace Technology
Overview
The Norwegian Government presented a core defense spending budget of USD 6.9 billion in 2019. The Norwegian defense budget accounted for 1.62% of Norway’s GDP in 2018, which is still below the NATO target of 2%. Norway spends 26.7 % of its defense budget on investments, which is above the NATO guideline of 20% (2018). The defense spending per Norwegian citizen is USD 1,428.
For the civilian aerospace industry, statistics from the Confederation of Norwegian Enterprises (NHO), Department of Civil Aerospace, show that around 70% of people traveling by air in Norway do not have any other viable travel options. 34% of tourists visiting Norway arrive by air. The Norwegian aerospace industry employs close to 61,000 people and the value chain contributes more than USD 1.56 billion in taxes. Annually there are 200,000 international flight departures that connects Norway to 130 airports in 35 countries.
Norway is a member of the International Civil Aviation Organization (ICAO), hence the country adopts and adjusts to regulations and technical standards provided by the ICAO. Norway is not an EU member, but the country commits to most EU regulations through the European Economic Area (EEA), which also connects and commits Norway to European Aviation Safety Agency (EASA) standards.
Opportunities
The defense industry in Norway is known for its niche product spectrum. The Norwegian government has selected eight focus areas for cooperation between the defense industry and the Norwegian Armed Forces:
| Prioritized Competence Areas | |
| 1 | Command, Control, Information Systems |
| 2 | System Integration |
| 3 | Autonomous Systems |
| 4 | Missile Technology |
| 5 | Underwater Sensors |
| 6 | Ammunition, Target Technology, Remote Controlled Weapon System and Military Explosives |
| 7 | Material Technology |
| 8 | Life Support for Military Land, Air and Naval Operation Systems |
Larger systems, vessels and vehicles are usually purchased from foreign companies through industrial cooperation agreements.
Most Norwegian defense companies are relatively small compared to international defense companies. According to the EU definition of sizable companies, only three Norwegian defense companies can be considered large, and these are Kongsberg Defense and Aerospace, Nammo and AIM Norway (recently acquired by the Kongsberg Group).
There are significant procurement opportunities expected within all military branches in the coming years. The period 2018-2020 is dominated by the ongoing F-35 acquisition, and investments in Land systems and Naval systems. Deliveries of the F-35 Lightning II will continue. The first two F-35s were delivered in 2015 for training purposes in the United States. Norway received its first F-35s on Norwegian soil in November 2017 and is expected to receive six F-35s annually until 2024 – for a total of 52 aircraft.
Norway signed a contract for four new submarines from Germany in 2017. The contract was awarded to the ThyssenKrupp Marine Systems (TKMS) yard in Kiel for a total value of NOK 30 billion (around USD 3.8 billion). The new submarines are expected to be delivered during 2026-2030 and will replace current Ula class submarines.
Norway will replace its P-3C Orion and DA-20 Jet Falcon maritime patrol aircraft with five new P-8A Poseidon MPAs. The first aircraft delivery is expected in 2022.
Norway will strengthen its ground-based air defenses via an upgrade of the current medium-range
NASAMS II system and introduce new air defense systems with long range missiles and sensors.
On the civil aviation side, Norwegian Air Shuttle ASA has opted to modernize its fleet with 114 state-of-the-art Boeing 737-800 and 100 737-MAX aircrafts. Norwegian Air is continuing to open additional long-haul operations. The company currently has 13 787-Dreamliners in its long-haul fleet, and has an additional 32 on order. In total, Norwegian Air has around 130 Boeing aircraft on order.
Scandinavian Airlines (SAS) started modernizing its long-haul fleet with new aircraft in 2016. An order of 30 Airbus A320 NEOs, two Airbus A330 Enhanced and eight Airbus A350s has been placed. In June 2018, the Ministry of Trade, Industry and Fisheries sold its 37.8 million shares in SAS for about NOK 597 million (USD 75 million). After the sale, the state no longer owns shares in the company.
Oslo Airport Gardermoen was re-opend after expansion in April 2017. Capacity in the departure halls has increased with new check-in counters, and the building has a completely new luggage handling system in order to increase efficiency amd enhance security.