Why the Torpedo Market Is Growing in an Era of Drone Warfare

The Weapon That Won World War II at Sea Is Still Being Developed

The torpedo is one of the oldest guided weapons in existence. It is also one of the few that has never stopped being improved. While public attention in defense technology tends to follow drones, hypersonic missiles, and cyber capabilities, the Torpedo Market has been quietly expanding for over a decade — driven by renewed submarine competition, aging fleet inventories across NATO and Asia-Pacific navies, and a generation of propulsion and guidance technology that has significantly extended what these weapons can do.

Market.us recently published a research note on this sector. Readers who want the underlying data behind current procurement trends can access the full torpedo market dataset here.

Submarines Came Back — and So Did the Weapons They Carry

For much of the post-Cold War period, undersea warfare was treated as a secondary concern. The Soviet submarine threat had receded, and defense budgets in the West shifted toward counterinsurgency, air power, and land operations. That strategic logic has been visibly reversed over the past decade.

China now operates one of the largest submarine fleets in the world, with both nuclear-powered and diesel-electric variants expanding in number and capability. Russia has continued modernizing its undersea forces despite broader economic constraints. In response, the United States, United Kingdom, Japan, South Korea, Australia, and several European navies have all announced or accelerated submarine and anti-submarine warfare programs.

Torpedoes are the primary armament for both offensive submarine operations and anti-submarine defense. Every submarine in service carries them. Most maritime patrol aircraft and many surface warships carry lightweight variants for anti-submarine roles. When navies grow their undersea capabilities, torpedo procurement follows directly.

What Has Actually Changed Technically

Cold War-era torpedoes were largely dependent on wire guidance — an operator tracking the weapon after launch and steering it toward the target. Modern designs are substantially more autonomous. The U.S. Navy's MK-54 lightweight torpedo, used by both aircraft and surface ships, carries onboard processors capable of classifying contacts and distinguishing a real submarine from a decoy without operator input during the terminal phase of an attack.

Heavyweight torpedoes — the kind carried by submarines — have advanced further. Fiber-optic wire guidance extends control range considerably beyond what copper wire allowed. Electric propulsion systems using lithium-ion battery technology have replaced older thermal designs in several programs, reducing acoustic signature while extending operational range. A torpedo that is harder to detect acoustically is a meaningful tactical advantage when the entire point is to not reveal the launching submarine's position.

Analysts examining the Torpedo Market have identified propulsion modernization and autonomous target classification as the two engineering areas receiving the most sustained investment across the major naval development programs currently active.

AUKUS and the Cascade Effect of Major Naval Commitments

The clearest illustration of how strategic decisions translate into torpedo procurement is the AUKUS submarine agreement. Under the arrangement between Australia, the United Kingdom, and the United States, Australia is acquiring nuclear-powered submarines for the first time in its history.

That decision creates a cascade of procurement requirements. Australia needs compatible heavyweight torpedoes to arm the new submarines. It needs to maintain stocks of lightweight variants for its maritime patrol aircraft operating in coordination with those submarines. It needs to build the maintenance infrastructure, the training pipelines, and the logistics chain to sustain all of it over decades.

AUKUS is one agreement among several reshaping undersea procurement. Japan has expanded its submarine fleet and upgraded its anti-submarine surface vessels. India is building indigenous nuclear-powered submarines. Norway, Sweden, Germany, and the Netherlands have all invested in new or upgraded conventional submarine programs within the past five years. Each of these programs generates direct and sustained torpedo demand.

The Question Autonomy Is Starting to Force

The longer-term development that naval engineers and procurement planners are watching most carefully is the unmanned underwater vehicle. Several programs across the U.S., U.K., and Australia are developing large autonomous undersea vehicles capable of operating independently in contested waters for extended periods.

The question of whether these vehicles will eventually carry and release weapons autonomously remains genuinely unresolved — more for doctrinal and legal reasons than technical ones. Most current programs position the vehicles as delivery or sensor platforms, with weapons release remaining a human decision. How that boundary shifts over the next fifteen years will determine whether the torpedo market expands into an entirely new platform category or remains concentrated on crewed submarines, aircraft, and surface ships.

What is already settled is that undersea competition has returned as a central organizing concern for the world's serious naval powers. The procurement budgets reflecting that concern are already written, already approved, and already being spent.