2026 Aerospace and Defense Industry Outlook

The aerospace and defense industry is entering a new era of growth, powered by AI, digital sustainment, and rising demand across the commercial and defense segments By Lindsey Berckman , Steve Shepley
The aerospace and defense industry is entering a new era of growth, powered by AI, digital sustainment, and rising demand across the commercial and defense segments By Lindsey Berckman , Steve Shepley , Ajay Chavali , Kate Hardin , Scott Welch , Tarun Dronamraju 13 November 2025 The aerospace and defense industry stands at a pivotal crossroads as it enters the latter half of the decade. Forces that have shaped the sector in recent yearsdigital transformation, supply chain volatility, talent constraints, and geopolitical eventsare converging with new catalysts such as agentic AI, emerging vehicles, and the rapid evolution of autonomous systems. The commercial aerospace sector appears poised to continue growth, fueled by rising fleet utilization, continued fleet growth, and steady gains in both passenger and cargo demand.1 Persistent aircraft production backlogs are prompting operators to fly existing fleets longer and invest more in reliability, availability, and maintainability. On the defense side, budgets are a key focus, with a growing emphasis on enhancing mission readiness. At the same time, defense priorities are shifting to accelerate the fielding of AI-enabled systems and collaborative combat aircraft. Speed to field is becoming the unifying metric across portfolios. Deloittes 2026 aerospace and defense (A&D) outlook explores five trends likely to shape the industry in the year ahead. AI and agentic AI: Transforming A&D Aftermarket: Reshaping maintenance, repair, and overhaul Supply chain: Building resiliency and efficiency amid volatility Contracting and procurement: Unlocking competitive advantage in A&D AI-driven workforce transformation: Shifting from big data to multidisciplinary skill sets https://www.deloitte.com/us/en/insights/industry/aerospace-defense/aerospace-and-defense-industry-outlook.html