WASHINGTON As the U.S. military adopts RFID technology for logistics applications like inventory control, military and aerospace contractors are expected to expand their use of RFID for services like the maintenance, repair and overhaul of military equipment and aircraft.
New York-based ABI Research said Tuesday (Oct. 31) that the military and aerospace market for RFID could reach $2 billion by 2011. Maintenance, repair and overhaul are seen as leading market drivers, the market researcher said.
The Pentagon has been making greater use of passive RFID technology to streamline procurement and get a handle on its massive supply chain. DoD's RFID policy aims to speed transactions with contractors who make up one of the largest enterprises on earth.
Now, the market research concluded, contractors and aerospace companies are responding in kind. ABI said RFID could help contractors develop an integrated supply chain for centralized procurement. Once implemented, the market researcher predicted, military and aerospace contractors could eventually outsource supply chain functions to focus on core functions.
"RFID can fulfill many [maintenance, repair and overhaul] requirements by enabling real-time track-and-trace and unique identification," ABI research director Michael Liard said in a statement.
Despite its promise, RFID technology has its critics. Privacy advocates have warned of unresolved security issues that could compromise sensitive data as well as users' privacy and financial records.
IBM, a major supplier of RFID technology to the Defense Department,, counters that critics are part of an "anti-retail movement."