Japan C4ISR - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Japan C4ISR Market size is estimated at USD 462.27 million in 2024, and is expected to reach USD 558.38 million by 2029, growing at a CAGR of 3.85% during the forecast period (2024-2029).

Despite the COVID-19 pandemic hitting the global economy severely, the impact of the same is not felt on the military expenditure, Japanese military spending totaled USD 54.1 billion in 2021. Such high expenditure indicates the negligible impact the COVID-19 pandemic had on defense systems development and procurements. The growth in military spending is expected to drive the prospects of the market into focus.

In Japan, defense spending, as well as investments in control, command, communications, computer, intelligence, surveillance, and reconnaissance (C4ISR), is mainly increasing, due to the rising dominance of China and North Korea in Asia-Pacific.

On the other hand, the factors like growing terrorism, threats from adversaries, and increasing territorial tensions around the Country, are propelling the militaries to enhance their battlefield data-sharing capabilities. The growing demand for asymmetric warfare, along with increasing demand for advanced technologies like network-centric battle management and unmanned vehicles, is expected to accelerate the market growth during the forecast period.

The integration of advanced technologies in battlefield management, to provide better tactical communications and enhance the situational awareness of soldiers, is anticipated to propel the growth of the C4ISR market in Japan.

Also, the country is investing in the integration of artificial intelligence into various military platforms and command and control centers, to increase the effectiveness of these systems in aiding ISR and combat missions.

Japan C4ISR Market Trends

Increasing Military Expenditure by Japan on C4ISR Systems

Japan has gradually increased its military spending over the years to modernize its military forces against the growing dominance of China and the threat of nuclear weapons from North Korea. Japanese military spending totaled $54.1 billion in 2021. In November 2021 the government allocated an additional $7.0 billion to its military budget, which resulted in a 7.3 percent increase in military spending over the year and the highest annual growth rate since 1972. At 1.1 percent of GDP in 2021, Japan's military burden surpassed the 1 percent of GDP threshold for the first time since 1960. the government announced several acquisition and R&D plans to enhance the EW capabilities of ground forces and the air force. The plans included the following:

The procurement of one complete system of truck-mounted Network Electronic Warfare Systems (NEWS) and the establishment of a new EW unit by the end of 2020. Also, additional investment in the development of a new ground-based, anti-aircraft EW system.

Continue the modernization of EW suites onboard F-15J/DJ Eagle aircraft, in order to expand its multirole capabilities and develop a new standoff jammer, which will be mounted on Kawasaki C-2 airlifter, to perform standoff jamming against adversaries in the air, land, and naval domains.

Also, the government is investing in the development of space-based ballistic-missile early-warning systems. Such investments in the procurement and development of advanced C4ISR solutions are anticipated to propel the development of the market during the forecast period.

Increasing Demand For Advanced Safety And Detection Systems In Land and Naval segment

The increasing demand for advanced safety and detection systems across the country has driven responsible government organizations to expand their services and capabilities in Japan. The already existing ground units and the future units are expected to increase the demand for electronic warfare units by a significant margin, leading to a noticeable growth in the market size. The country further expanded its military capabilities via electronic warfare units. As of April 2022, the new units established can also detect and analyze potential adversaries, communications, and radar emissions. The units hope to expand their counter-drone capabilities with these new electronic warfare units. The highly increasing military activity in China has alerted many countries around it. As a result, the countries around China have been investing in new technologies and partnerships in order to improve their safety. As part of this, Japan and the Philippines formed an agreement to set up security ties in April 2022, to bolster security cooperation and joint drills. This partnership is expected to drive significant demand for the C4ISR equipment to be used for various military activities executed by the partnership. Japan, in Jan and Feb 2022, made strategic defense partnerships with major countries like United States and the United Kingdom, for sharing knowledge of defense technologies, amid the increasing worry about China's military activity.

Several developments are expected to drive the market towards significant growth rates during the forecast period.

Japan C4ISR Industry Overview

The prominent players in the market are Northrop Grumman Corporation, Thales Group, Elbit Systems Ltd, and L3Harris Technologies Inc. Local firms, like Kawasaki Aerospace Company, occupy a significant share in the market, as they provide patrol aircraft and other surveillance platforms to Japan's armed forces. The procurement of new surveillance platforms, in accordance with the government's modernization plans, is anticipated to help companies receive new contracts which is likely to rampup the market growth in coming year.

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