Global Close-In Weapon Systems (CIWS) Upgrade And Retrofit Market Size, Share, Trends and Forecasts 2031

Key Findings

• The CIWS upgrade and retrofit market addresses modernization of naval and land-based last-ditch defense systems through life-extension kits, sensor and fire-control refresh, effectors, power/thermal upgrades, and digital integration without full platform replacement.

• Multi-sensor convergence is reshaping CIWS with fused radar/EO/IR, passive RF, and combat-management links to raise track quality, reduce false alarms, and support smarter engagement logic.

• Counter-UAS and saturation threats are the primary mission drivers, pushing higher engagement rates, improved ammunition/lethality options, and software-defined fire-control updates.

• Open-systems architectures and modular backplanes accelerate insertion of processors, AESA front-ends, and effectors while preserving legacy mechanical footprints.

• Ship power and cooling constraints often bound performance; retrofit roadmaps increasingly include power conversion, cabling, and HVAC augmentation to unlock sensor and effector upgrades.

• Through-life support models bundle spares, obsolescence management, predictive maintenance, and training simulators into multi-year availability contracts.

• Software-centric enhancements—track classification, clutter rejection, and cue management—deliver step improvements without heavy hardware changes.

• Weapon-effectors mix is diversifying from gun-only to gun+missile and gun+hard-kill interceptors, with programmable airburst and guided rounds in evaluation for certain fleets.

• Cyber and safety assurance are now baseline requirements, adding secure boot, partitioning, and mission-data verification to modernization scopes.

• Export and compliance regimes shape timelines and configurations; sovereign content and local MRO partnerships are common selection factors.

Market Size and Forecast

The global CIWS Upgrade and Retrofit market was valued at USD 3.1 billion in 2024 and is projected to reach USD 5.9 billion by 2031, registering a CAGR of 9.6%. Growth is led by naval recapitalization, rising counter-UAS mandates, and the need to extend legacy mounts in lieu of new-build replacements. Spend concentrates on radar/EO refresh, digital fire-control, ammunition handling, structural life extension, and combat-system interfaces. Services revenue expands through long-term availability contracts that include obsolescence management, tech insertions, and training. Regional demand clusters around fleets operating legacy CIWS blocks seeking incremental capability against faster, smaller, and lower-RCS threats.

Market Overview

CIWS provide terminal defense against missiles, aircraft, UAS, and fast inshore attack craft by combining high-rate effectors with high-fidelity sensing and automated fire-control. Many fleets operate legacy systems whose mechanical bases and deck penetration cannot be easily replaced, making upgrade paths attractive on cost, weight, and schedule. Modernization typically spans AESA or enhanced pulse-Doppler radars, stabilized EO/IR directors, digital signal processing, and engagement management aligned with updated rules of engagement. Gun systems receive barrel, feeder, and cooling upgrades alongside new ammunition families and muzzle-velocity measurement for tighter ballistic solutions. Hybrid configurations add short-range missiles or guided interceptors to extend defended footprints and reduce ammunition expenditure per kill. Integration emphasizes low-latency links with combat management systems, navigation data, and cooperative sensors to elevate threat evaluation and firing doctrine.

Future Outlook

By 2031, CIWS upgrades will center on software-defined, multi-sensor, and multi-effector stacks packaged within legacy mechanical and ship-service constraints. Expect broader adoption of open middleware and standardized timing/safety buses to decouple fire-control algorithms from sensor/efferctor refresh cycles. Programmable airburst and guided sub-munitions will progress where safety arcs and deck vibrations can be managed, complementing missiles for layered terminal defense. Sustainment will lean on condition-based maintenance, digital twins, and remote OEM support to maximize mount availability and manage barrel/wear life. Cyber-resilient boot chains, data diodes, and secure mission-data loads will become certification gatekeepers for fleet acceptance. Vendors able to stage capability in incremental software and LRUs, with minimal topside rework, will win multi-year fleet frameworks.

Market Trends

• Multi-Sensor Fusion And Smarter Engagement Logic
  Upgrades are moving beyond single-sensor radars to fused radar, EO/IR, and passive RF for resilient detection of low-RCS and sea-skimming threats. Fire-control software leverages classification cues, track quality metrics, and approach geometry to gate firing and prioritize targets. Fusion improves discrimination of birds and clutter, reducing wasted bursts and preserving ammo depth. EO/IR channels extend utility in RF-degraded environments and enable identification for rules-of-engagement compliance. Latency-aware data paths to combat systems support cooperative cueing and handover from offboard sensors. The result is higher hit probability per round and fewer false engagements across sea states and backgrounds.

• Gun-Missile Hybridization And Programmable Effects
  Many navies are adding very-short-range missiles or guided interceptors to traditional gun mounts to expand defended volume. Programmable airburst and advanced fuzes are evaluated to improve lethality against small UAS swarms and complex angles. Hybrid stacks allow doctrine to reserve guns for terminal shots while missiles thin raids earlier to manage reload tempos. Integration focuses on unified trackers and shared fire-control so mounts arbitrate effectors without operator overload. Logistics and safety cases evolve to store and handle mixed munitions on compact decks. Collectively these changes deliver layered terminal defense from a common footprint.

• Open-Architectures, LRUs, And Low-Impact Shipfit
  Open standards in processing backplanes and timing networks let fleets insert new radars, EO heads, and algorithms without deep hull changes. Line-replaceable units with defined thermal and power envelopes shorten dock time and simplify spares. Software containers and modular firmware permit rapid security patches and capability drops aligned to threat intel. Standardized interfaces with combat systems reduce bespoke bridges, speeding accreditation. Shipfit kits target minimal cabling, reusing power/HVAC and mechanical bases to control topside weight and CG. This approach turns CIWS modernization into repeatable, scalable shipyard routines.

• Counter-UAS Optimization And Swarm Resilience
  Engagement logic and sensors are tuned for small UAS signatures, erratic kinematics, and clutter near ports and littorals. High-update trackers and burst-control laws preserve barrel life and magazine depth against many small targets. EO/IR aids tracking of plastics/foam airframes with weak radar returns, while muzzle-velocity sensing tightens ballistic prediction for small cross-sections. Deconfliction with soft-kill EW and decoys reduces blue-on-blue interference during swarm events. Range safety and ricochet modeling evolve for near-shore arcs and civil-adjacent operations. These adaptations raise effectiveness without exclusive reliance on expensive interceptors.

• Sustainment Digitalization And Predictive Maintenance
  Fleets are adopting sensorized barrels, feeder counters, and vibration/temperature monitoring to forecast wear and schedule interventions. Digital twins map firing profiles to life consumption, informing training tempo and spares provisioning. Remote diagnostics and secure data packages enable OEMs to advise on tuning, fault triage, and software updates between port calls. Obsolescence roadmaps bundle COTS refresh cycles and cybersecurity patches into planned availabilities. Training simulators and embedded analytics shorten crew learning curves after upgrades. The net effect is higher availability, safer operation, and better cost control over the service life.

Market Growth Drivers

• Rising Saturation And Low-Altitude Threats In Littorals
  Modern anti-ship tactics emphasize low-RCS profiles, complex sea clutter, and coordinated raids that compress reaction time. Upgrading CIWS improves detection, classification, and engagement rates needed to manage composite threats close to the hull. Fleets prioritize terminal defense to complement area weapons and cover doctrine gaps near port entries and choke points. Coastal operations and mixed civil traffic demand more discriminating sensors and rules-based fire-control. Investments provide immediate readiness gains without waiting for full ship class overhauls. These dynamics translate into near-term, repeatable demand for modernization packages.

• Counter-UAS Mandates For Naval And Shore Sites
  Proliferation of Group 1–3 UAS drives requirements for kinetic options where soft-kill is insufficient or restricted by ROE. CIWS upgrades adapt gun accuracy, fuze modes, and sensors to defeat small, slow, and low flyers near critical infrastructure. Ports, naval bases, and expeditionary sites add C2 hooks to integrate CIWS into layered C-UAS architectures. Procurement favors retrofits that leverage existing mounts and magazines to control footprint and cost. Demonstrated effectiveness in exercises accelerates budget approvals. This driver sustains multi-year retrofit lines across regions.

• Budget Efficiency Via Life-Extension Over New-Builds
  Extending legacy mounts through electronics and barrel/feed upgrades avoids long timelines and integration risks of new turrets. Reusing deck structures, power, and cabling preserves ship stability and reduces dry-dock days. Open-architecture processors and sensors keep capability current while deferring capital-intensive replacements. Multi-year support contracts spread costs and lock in availability metrics attractive to planners. Proven upgrade kits de-risk execution for overstretched shipyards. The financial calculus strongly favors retrofit cycles in many fleets.

• Software-Defined Fire-Control And Rapid Capability Insertion
  Algorithmic advances deliver measurable gains in clutter rejection, target quality scoring, and burst control without heavy hardware swaps. Fieldable software updates compress response to emerging TTPs and sensor countermeasures. Modular code aligned to open APIs makes validation and cyber-hardening repeatable. Operators gain performance step-ups within existing safety cases and crew training constructs. Shorter delivery cycles fit operational windows better than full mechanical replacements. This software vector turbocharges the business case for continuous modernization.

• Interoperability With Combat Systems And Cooperative Sensors
  Upgraded CIWS that speak modern combat-system protocols benefit from offboard cues, improving first-shot opportunities. Shared tracks and doctrine allow mounts to coordinate with decoys, ECM, and medium-range interceptors. Integration reduces duplicate sensors and uncoordinated engagements that waste ammo or create safety risks. Fleet planners see improved mission effectiveness from the same hulls after relatively small investments. Common interfaces also simplify multinational exercises and coalition deployments. This systems-of-systems payoff is a strong procurement lever.

Challenges In The Market

• Ship Services, Weight, And Topside Integration Limits
  Legacy power, cooling, and deck strength can cap achievable sensor and effector upgrades. Exceeding limits risks stability, EMI, or HVAC shortfalls that degrade reliability. Engineering around constraints adds cost and schedule while narrowing vendor options. Some hulls require structural work or power conversion that erodes retrofit savings. Careful surveys and ship-specific kits become mandatory to avoid surprises. These realities slow programs and restrict one-size-fits-all solutions.

• Magazine Depth, Reload Concepts, And Safety Arcs
  Higher engagement rates against swarms strain ammunition logistics and reload tempos. Deck layouts and crew safety rules bound acceptable reload procedures during operations. Airburst and guided rounds raise certification complexity and cost for safety cases. Missile add-ons compete for space and weight with other mission kits. Without holistic loadout planning, upgrades can shift rather than solve bottlenecks. Balancing lethality with practical sustainment remains difficult.

• EMI/EMC, Shock, And Environmental Qualification
  New AESA radars, processors, and power converters must meet strict EMI and shock specs on aging platforms. Failures appear as intermittent tracks, false alarms, or processor resets that are hard to reproduce. Qualification in salt-fog, vibration, and temperature extremes adds time and NRE. COTS components require careful shielding and filtering to survive topside environments. Compliance gaps can force redesigns late in programs. These hurdles raise risk for aggressive timelines.

• Cybersecurity And Software Assurance Overhead
  Secure boot, partitioned networks, and signed mission-data loads are now baseline, but they add integration and accreditation effort. Patch windows at sea are limited, requiring robust rollback and verification processes. Supply-chain artifacts and SBOMs increase documentation burden for vendors and navies. Missteps can delay fleet acceptance despite technical performance. Long-tail maintenance of crypto and OS stacks must be budgeted. Cyber rigor is essential but resource intensive.

• Export Controls, ITAR/EAR, And Sovereign Variants
  Advanced sensors, processors, and fuzes trigger licensing that stretches sales cycles and complicates spares. Sovereign customers request local content, documentation access, and MRO rights that fragment configurations. Variant proliferation strains vendor support and testing capacity. Policy changes can stall deliveries mid-program, impacting fleet timelines. Managing compliance while maintaining common baselines is challenging. These factors inject uncertainty into bookings and revenue recognition.

Market Segmentation

By Upgrade Scope

• Sensor Suite (Radar, AESA Front-Ends, EO/IR Directors)

• Fire-Control Computers & Algorithms

• Effectors (Gun Enhancements, Missile/Interceptor Add-Ons)

• Ammunition Handling, Fuzes, Programmable Rounds

• Power/Cooling, Cabling, Structural Life-Extension

By Platform

• Surface Combatants (Frigates/Destroyers/Corvettes)

• Amphibious & Support Ships

• Coastal/Fixed Site and Expeditionary Mounts

• Land-Based Point Defense (Critical Infrastructure)

By Integration Level

• Software-Only Capability Insertion

• Electronics/Sensor LRU Replacement

• Full Hybrid (Sensors + Effectors + Ship Services)

By Mission Focus

• Anti-Ship Missile Defense

• Counter-UAS/USV and Swarm Defense

• Fast Inshore Attack Craft (FIAC) Protection

• Base/Harbor Point Defense

By Region

• North America

• Europe

• Asia-Pacific

• Latin America

• Middle East & Africa

Leading Key Players

• RTX (Raytheon)

• Lockheed Martin

• BAE Systems

• Rheinmetall

• Leonardo S.p.A.

• Thales Group

• Northrop Grumman

• General Dynamics Mission Systems

• Hanwha Aerospace/Defense

• Elbit Systems

• Hensoldt

• Saab AB

Recent Developments

• Raytheon introduced a CIWS software upgrade package featuring enhanced clutter rejection, EO/IR fusion, and counter-UAS track handling within existing processing envelopes.

• BAE Systems demonstrated a hybrid gun-missile retrofit concept with unified fire-control, targeting improved defended footprint on mid-size combatants.

• Thales Group unveiled an open-architecture radar/EO director LRU set designed for low-impact shipfit and rapid dockside replacement.

• Rheinmetall released programmable airburst ammunition and muzzle-velocity sensing kits tailored to legacy naval gun mounts.

• Leonardo validated a CIWS–combat system interface upgrade enabling cooperative cueing and doctrine-based engagement sequencing on legacy hulls.

This Market Report Will Answer The Following Questions

• Which upgrade combinations (sensors, software, effectors) deliver the best kill probability per dollar across ship classes?

• How should navies plan power, cooling, and structural allowances to future-proof CIWS within legacy hull constraints?

• What doctrines and software features most improve counter-UAS and swarm resilience without excessive ammunition burn?

• Where do gun-missile hybrids outperform gun-only or missile-only approaches on defended footprint and logistics?

• How can open architectures and LRUs reduce dock time while sustaining cyber and safety certifications?

• What sustainment metrics—barrel life, mean rounds between stoppage, sensor MTBF—should anchor availability contracts?

• How do export controls, sovereign variants, and local MRO requirements affect lifecycle cost and supportability?

• Which training and simulation tools best accelerate crew proficiency after modernization?

• What KPIs should drive procurement scoring: time-to-first-shot, rounds-per-kill, false-engagement rate, or reload tempo?

• How will software-defined fire-control and digital twins change upgrade cadence and through-life economics through 2031?