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The Boeing Company BA recently clinched a contract to provide mission computing upgrade installation for the Japan E-767 Airborne Warning and Control System (“AWACS”) aircraft. The award has been offered by the Air Force Lifecycle Management Center, Hanscom Air Force Base, MA.
Details of the Deal
Valued at $84.6 million, the contract is projected to be completed by Dec. 23, 2028. The latest modification brought the total cumulative face value of the contract to $330.5 million.
Work related to the contract will be executed in Oklahoma City, OK, and San Antonio, TX.
What’s Favoring BA Stock in Japan?
The growing threats in the Indo-Pacific region, such as hypersonic, long-range, re-targetable missiles and advanced early warning systems capable of detecting stealth fighters, have necessitated the modernization of Japan’s air defense capabilities.
Emerging geopolitical threats have forced nations across the globe to boost their defense spending significantly in recent times. Japan, being no exception, has become one of the major forerunners in this space. To this end, it is imperative to mention that the country is expected to be the world's third-largest defense spender by 2027, after the United States and China (as per the Morder Intelligence firm).
This should bolster Boeing’s growth prospects in Japan, considering the fact that Boeing has been a key supplier of defense equipment, aircraft and services to its Ministry of Defense for more than 65 years now.
Notably, Japan’s Self-Defense Forces have built and operated the largest fleets of Boeing’s F-15 fighters and CH-47 Chinook helicopters outside the United States. The aerospace giant’s strong presence in Japan’s defense industry can be further gauged from the fact that more than 300 Boeing airplanes made by Japanese partners currently fly in defense of the country. The latest contract win further strengthens Boeing’s importance in Japan’s defense space.
Other Defense Stocks to Watch
Defense stocks other than Boeing that have a strong presence in Japan and are thus expected to benefit from the expanding Japanese defense investment have been discussed below.
RTX Corp. RTX: Its APG-82(V)1 AESA radar is integrated into the F-15 JSI program. Moreover, the F-100 engine, manufactured by RTX’s Pratt &Whitney, powers the F-15 jets. In January 2025, the U.S. State Department approved a potential sale of advanced medium-range air-to-air missiles and related equipment to Japan for an estimated $3.64 billion, with the principal contractor for the sale being RTX (as per a report by Reuters).