Table of Contents 1. Introduction 9 1.1. What is this Report About? 9 1.2. Definitions 9 1.3. Summary Methodology 11 1.4. About Strategic Defence Intelligence 12 2. Executive Summary 13 3. Market Attractiveness and Emerging Opportunities 15 3.1. Current Market Scenario 16 3.1.1. Primary Threat Perception 16 3.1.2. Military Doctrine & Strategy 18 3.1.3. Military Fleet Size 21 3.1.4. Procurement Programs 26 3.1.5. Ongoing Procurement programs 26 3.1.6. Future Procurement Programs 28 3.1.7. Top Procurement Programs by Value (US$ Million) 2018-2023 29 3.1.8. Social, Political and Economic Environment & Support for Defense Projects 30 3.1.9. Political & Strategic Alliances 31 3.2. Defense Market Size Historical and Forecast 32 3.2.1. French total defense expenditure, including pensions, to grow at a CAGR of 4.14% during 2019-2023 32 3.2.2. French defense budget, excluding pensions, to grow at a CAGR of 4.43% during 2019-2023 34 3.2.3. International peacekeeping operation contributions and armed forces modernization programs drive the French defense industry 36 3.2.4. Defense budget as a percentage of GDP will remain at an average of 1.70% over the forecast period 37 3.3. Analysis of Defense Budget Allocation 39 3.3.1. Share of capital expenditure is expected to increase during the forecast period 39 3.3.2. Capital expenditure is anticipated to record a CAGR of 4.66% over the forecast period 41 3.3.3. The army accounted for the largest percentage share of the overall French defense budget 43 3.3.4. Army to continue accounting for the majority share of the France defense budget 45 3.3.5. French per capita defense expenditure to increase during the forecast period 49 3.4. Homeland Security Market Size and Forecast 51 3.4.1. France’s homeland security market is expected to grow at a CAGR of 2.24% over the forecast period 51 3.4.2. Counter terrorism activities, cyber security, police modernization, and gendarmerie drives France’s homeland security expenditure 53 3.4.3. France falls under the “highly affected” category in the terrorism index 55 3.4.4. France faces threats from terrorist organizations 56 3.4.5. France has a terrorism index score of 6.0 58 3.5. Benchmarking with Key Global Markets 59 3.5.1. France ranks highly among the major global defense markets 59 3.5.2. France is expected to remain among the top 10 defense spending countries in the world 61 3.5.3. French defense budget as a percentage of GDP is expected to decline over the forecast period 62 3.6. Market Opportunities: Key Trends and Drivers 63 3.6.1. Top 10 Defense Market Sectors by Value (US$ Million) - Projections over period 2018-2023 63 3.6.2. Physical Security 64 3.6.3. Land-based C4ISR 65 3.6.4. Military IT-Networking 66 3.6.5. Transport Aircraft 67 4. Defense Procurement Market Dynamics 68 4.1. Import Market Dynamics 69 4.1.1. Domestic companies are key equipment suppliers to the French Ministry of Defense 69 4.1.2. The US, Spain, and the Netherlands are France’s major suppliers 70 4.1.3. Aircraft and missiles accounted for a total share of 60.3% in terms of French defense imports 71 4.2. Export Market Dynamics 72 4.2.1. France ranked fifth among the countries with the highest volume of defense exports 72 4.2.2. Asian countries are the major prospects for French defense exports 73 4.2.3. Aircraft accounted for a large share of French defense exports during 2011-2015 74 5. Industry Dynamics 75 5.1. Five Forces Analysis 75 5.1.1. Bargaining Power of Supplier: Low 76 5.1.2. Bargaining Power of Buyer: High 76 5.1.3. Barrier to Entry: High 76 5.1.4. Intensity of Rivalry: Medium to High 76 5.1.5. Threat of Substitution: Medium 76 6. Market Entry Strategy 77 6.1. Market Regulation 77 6.1.1. No formal offset policy in France 77 6.1.2. Foreign direct investment in the defense sector and transfer of defense-related products are subject to prior authorization 77 6.2. Market Entry Route 78 6.2.1. Budgeting Process 78 6.2.2. Procurement Policy and Process 79 6.2.3. Foreign Military Sales (FMS) to France 80 6.2.4. Collaborations provide market entry opportunities 80 6.2.5. Joint equipment programs favored by the French government 81 6.3. Key Challenges 82 6.3.1. Increased preference for domestic and European defense companies impedes the entry of non-European firms 82 6.3.2. Increased cost overruns and delays in product delivery 82 7. Competitive Landscape and Strategic Insights 83 7.1. Competitive Landscape Overview 83 7.2. Key Public Sector Companies 86 7.2.1. Dassault Aviation: Overview 86 7.2.2. Dassault Aviation: Product Focus 86 7.2.3. Dassault Aviation: Recent Announcements and Strategic Initiatives 86 7.2.4. Dassault Aviation: Alliances 89 7.2.5. Dassault Aviation: Recent Contract Wins 90 7.2.6. Dassault Aviation: Financial Analysis 91 7.2.7. Thales: Overview 93 7.2.8. Thales: Major Products and Services 93 7.2.9. Thales: Recent Announcements and Strategic Initiatives 95 7.2.10. Thales: Alliances 99 7.2.11. Thales: Recent Contract Wins 101 7.2.12. Thales: Financial Analysis 105 7.2.13. Constructions Mécaniques de Normandie (CMN): Overview 107 7.2.14. Constructions Mécaniques de Normandie (CMN): Product Focus 107 7.2.15. Constructions Mécaniques de Normandie (CMN): Recent Announcements and Strategic Initiatives 107 7.2.16. Constructions Mécaniques de Normandie (CMN): Alliances 108 7.2.17. Constructions Mécaniques de Normandie (CMN): Recent Contract Wins 108 7.2.18. EuroTorp: Overview 109 7.2.19. EuroTorp: Product Focus 109 7.2.20. EuroTorp: Recent Announcements and Strategic Initiatives 110 7.2.21. EuroTorp: Alliances 110 7.2.22. EuroTorp: Recent Contract Wins 110 7.2.23. Airbus Defense and Space: Overview 112 7.2.24. Airbus Defense and Space: Major Products and Services 112 7.2.25. Airbus Defense and Space: Recent Announcements and Strategic Initiatives. 114 7.2.26. Airbus Defense and Space: Alliances 117 7.2.27. Airbus Defense and Space: Recent Contract Wins 118 7.2.28. Safran Group: Overview 121 7.2.29. Safran Group: Product Focus 121 7.2.30. Safran Group: Recent Announcements and Strategic Initiatives 122 7.2.31. Safran Group: Alliances 124 7.2.32. Safran Group: Recent Contract Wins 125 7.2.33. Safran Group: Financial Analysis 128 7.2.34. Nexter Systems: Overview 130 7.2.35. Nexter Systems: Product Focus 130 7.2.36. Nexter Systems: Recent Announcements and Strategic Initiatives 130 7.2.37. Nexter Systems: Alliances 131 7.2.38. Nexter Systems: Recent Contract Wins 132 7.2.39. MBDA: Overview 134 7.2.40. MBDA: Product Focus 134 7.2.41. MBDA: Recent Announcements and Strategic Initiatives 135 7.2.42. MBDA: Alliances 138 7.2.43. MBDA: Recent Contract Wins 139 7.2.44. Airbus Helicopters: Overview 141 7.2.45. Airbus Helicopters: Product Focus 141 7.2.46. Airbus Helicopters: Recent Announcements and Strategic Initiatives 142 7.2.47. Airbus Helicopters: Alliances 143 7.2.48. Airbus Helicopters: recent contract wins 144 7.2.49. Naval Group: Overview 146 7.2.50. Naval Group: Major Products and Services 146 7.2.51. Naval Group: Recent Announcements and Strategic Initiatives 147 7.2.52. Naval Group: Alliances 148 7.2.53. Naval Group: Recent Contract Wins 149 7.2.54. Renault Truck Defense: Overview 151 7.2.55. Renault Truck Defense: Product Focus 151 7.2.56. Renault Truck Defense: Recent Announcements and Strategic Initiatives 151 7.2.57. Renault Truck Defense: Alliances 153 7.2.58. Renault Truck Defense: Recent Contract Wins 153 8. Business Environment and Country Risk 155 8.1. Economic Performance 155 8.1.1. GDP Per Capita at Constant Prices (US$) 155 8.1.2. GDP at Current Prices (US$) 156 8.1.3. Exports of Goods and Services (LCU Billion) 157 8.1.4. Imports of Goods and Services (LCU) 158 8.1.5. Gross National Disposable Income (US$ Billion) 159 8.1.6. LCU per US$ (Period Average) 160 8.1.7. Market Capitalization of Listed Companies (US$ Billion) 161 8.1.8. Market Capitalization of Listed Companies (Percentage of GDP) 162 8.1.9. Government Cash Surplus/Deficit as a Percentage of GDP (LCU) 163 8.1.10. Goods Exports and Imports as a Percentage of GDP 164 8.1.11. Services Imports and Exports as a Percentage of GDP 165 8.1.12. Foreign Direct Investment, net (BoP, current US$ Billion) 166 8.1.13. Net Foreign Direct Investment as a Percentage of GDP 167 8.1.14. Mining, Manufacturing, Utilities Output (US$ billion) 168 9. Appendix 169 9.1. About SDI 169 9.2. Disclaimer 169

List of Tables Table 1: French Army Strength 21 Table 2: French Navy Strength 23 Table 3: French Air Force Strength 25 Table 4: French - Ongoing Development and Procurement Programs 26 Table 5: French - Future Procurement Programs 28 Table 6: Top French Defense Procurement Programs by Value (US$ Million) 2018-2023 29 Table 7: France Defense Expenditure (EUR billion & US$ billion), 2014-2023 32 Table 8: France Defense Budget Allocations Excluding Pensions (EUR billion & US$ billion), 2014-2023 34 Table 9: France GDP Growth and Defense Expenditure as Percentage of GDP Growth, 2014-2023 37 Table 10: France Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023 39 Table 11: France Defense Capital Expenditure (EUR Billion & US$ Billion), 2014-2023 41 Table 12: French Defense Budget Split Between Army, Navy, Air Force and Common Services, 2014-2023 43 Table 13: French Defense Budget in EUR Billion - Breakdown by Services (Army, Navy, Air Force and Common Services) 2014-2023 45 Table 14: French Defense Budget in US$ Billion - Breakdown by Services (Army, Navy, Air Force and Common Services) 2014-2023 47 Table 15: French Per Capita Defense Expenditure (US$), 2014-2023 49 Table 16: France Homeland Security Expenditure (EUR billion& US$ billion), 2014-2023 51 Table 17: Terrorism Index, 2018 56 Table 18: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023 59 Table 19: Top 10 The France’s Defense Market Sectors by Value (US$ Million) - 2018-2023 63 Table 20: French Budget Formation Timetable 78 Table 21: FMS deals to France 80 Table 22: French Participation in International Defense Equipment Development Collaborations 81 Table 23: Top 10 Defense Suppliers in The French Defense Industry - By Value (US$ Million) 2018-2023 83 Table 24: Competitive Landscape of the French Defense Industry 84 Table 25: Dassault Aviation - Product Focus 86 Table 26: Dassault Aviation - Alliances 89 Table 27: Dassault Aviation - Recent Contract Wins 90 Table 28: Thales - Major Products and Services 93 Table 29: Thales - Alliances 99 Table 30: Thales - Recent Contract Wins 101 Table31: Dassault Aviation - Product focus 107 Table 32: Constructions Mécaniques de Normandie (CMN) - Alliances 108 Table 33: Constructions Mécaniques de Normandie (CMN) - Recent Contract Wins 108 Table 34: Dassault Aviation - Product Focus 109 Table 35: EuroTorp - Alliances 110 Table 36: EuroTorp - Recent Contract Wins 110 Table 37: Airbus Defense and Space - Major Products and Services 112 Table 38: Airbus Defense and Space - Alliances 117 Table 39: Airbus Defense and Space - Recent Contract Wins 118 Table 40: Safran Technologies - Product Focus 121 Table 41: Safran Group - Alliances 124 Table 42: Safran Group - Recent Contract Wins 125 Table 43: Nexter Systems - Product Focus 130 Table 44: Nexter Systems - Alliances 131 Table 45: Nexter Systems - Recent Contract Wins 132 Table 46: MBDA - Product Focus 134 Table 47: MBDA - Alliances 138 Table 48: MBDA - Recent Contract Wins 139 Table 49: Airbus Helicopters - Product Focus 141 Table50:Airbus Helicopters - Alliances 143 Table51:Airbus Helicopters - Recent Contract Wins 144 Table 52: Naval Group - Major Products and Services 146 Table 53: Naval Group - Alliances 148 Table 54: Naval Group - Recent Contract Wins 149 Table 55: Renault Truck Defense - Product Focus 151 Table 56: Renault Truck Defense - Alliances 153 Table 57: Renault Truck Defense - Recent Contract Wins 153List of Figures Figure 1: France Defense Expenditure (EUR Billion), 2014-2023 33 Figure 2: France Defense Expenditure (US$ Billion), 2014-2023 33 Figure 3: France Defense Budget Allocations Excluding Pensions (EUR Billion), 2014-2023 35 Figure 4: France Defense Budget Allocations Excluding Pensions (US$ Billion), 2014-2023 35 Figure 5: France GDP Growth and Defense Expenditure as Percentage of GDP Growth, 2014-2023 38 Figure 6: France Defense Budget Split Between Capital and Revenue Expenditure (%),2014-2023 40 Figure 7: France Defense Capital Expenditure (EUR billion), 2014-2023 42 Figure 8: France Defense Capital Expenditure (US$ Billion), 2014-2023 42 Figure 9: French Defense Budget Split Between Army, Navy, Air Force and Common Services, 2014-2023 44 Figure 10: The French Defense Budget in EUR Billion - Breakdown by Services (Army, Navy, Air Force and Common Services) 2014-2023 46 Figure 11: The French Defense Budget in US$ Billion - Breakdown by Services (Army, Navy, Air Force and Common Services) 2014-2023 48 Figure 12: French Per Capita Defense Expenditure (US$), 2014-2023 50 Figure 13: French Homeland Security Expenditure (EUR billion), 2014-2023 52 Figure 14: French Homeland Security Expenditure (US$ billion), 2014-2023 52 Figure 15: Terrorism Heat Map, 2018 55 Figure 16: Terrorism Index, 2018 58 Figure 17: Benchmarking with Key Markets, 2014-2018 vs. 2019-2023 60 Figure 18: Defense Expenditure of the World’s Largest Military Spenders (US$ billion), 2018 and 2023 61 Figure 19: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2018 62 Figure 20: Physical Security Market Size (US$ Billion), 2018-2023 64 Figure 21: Land-based C4ISR Market Size (US$ Billion), 2018-2023 65 Figure 22: Military-IT Networking Market Size (US$ Billion), 2018-2023 66 Figure 23: Transport Aircraft Market Size (US$ Billion), 2018-2023 67 Figure 24: France’s Defense Procurements in Terms Of Their Supplier Relationships 68 Figure 25: French Defense Import Trend (US$ Million), 2012-2016 (TIV values*) 69 Figure 26: French Defense Imports by Country (%), 2012-2016 70 Figure 27: French Defense Imports by Category (%), 2012-2016 71 Figure 28: French Defense Export Trend (US$ Million), 2012-2016 (TIV values) 72 Figure 29: French Defense Exports by Country (%), 2012-2016 73 Figure 30: French Defense Exports by Category (%), 2012-2016 74 Figure 31: Industry Dynamics - Porter’s Five Forces Analysis 75 Figure 32: Dassault Aviation - Revenue Trend Analysis (EUR Billion), 2012-2016 91 Figure 33: Dassault Aviation - Operating Profit Trend Analysis (EUR Million), 2012-2016 91 Figure 34: Dassault Aviation - Net income Trend Analysis (EUR Million), 2012-2016 92 Figure 35: Thales - Revenue Trend Analysis (EUR Billion), 2012-2016 105 Figure 36: Thales - Operating Profit Trend Analysis (EUR Million), 2012-2016 106 Figure 37: Thales - Net Profit Trend Analysis (EUR Million), 2012-2016 106 Figure 38: Safran Group - Revenue Trend Analysis (EUR Billion), 2012-2016 128 Figure 39: Safran Group - Operating Profit Trend Analysis (EUR Million), 2012-2016 128 Figure 40: Safran Group - Net Profit Trend Analysis (EUR Million), 2012-2016 129 Figure 41: French GDP Per Capita at Constant Prices (US$), 2015-2025 155 Figure 42: France GDP at Current Prices (US$ Billion), 2015-2025 156 Figure 43: French Exports of Goods and Services (LCU Billion), 2005-2014 157 Figure 44: French Imports of Goods and Services (LCU Billion), 2005-2014 158 Figure 45: French Gross National Disposable Income (US$ Billion), 2005-2013 159 Figure 46: French LCU per US$, 2015-2024 160 Figure 47: French Market Capitalization of Listed Companies (US$ Billion), 2005-2012 161 Figure 48: French Market Capitalization of Listed Companies (% of GDP), 2005-2012 162 Figure 49: French Government Cash Surplus/Deficit as a % of GDP (LCU), 2005-2012 163 Figure 50: French Goods Exports and Imports as a % of GDP (%), 2005-2014 164 Figure 51: French Services imports and Exports as a % of GDP (%), 2005-2014 165 Figure 52: French Foreign Direct Investment, net (BoP, current US$ Billion), 2005-2014 166 Figure 53: French Net Foreign Direct Investment as a % of GDP, 2005-2014 167 Figure 54: French Mining, Manufacturing, Utilities Output (US$ Billion), 2005-2014 168

Dassault Aviation Thales Constructions Mécaniques de Normandie (CMN) EuroTorp Airbus Defense and Space Safran Group Nexter Systems MBDA Airbus Helicopters Naval Group Renault Truck Defense.