Overview 

Unit: USD millions 

[market size = (local production + imports) – exports] 

Data Sources: 

Local Production:  Ministry of Economy, Trade and Industry 

Exports:  Ministry of Finance 

Imports:  Ministry of Finance 

Imports from the US:  Ministry of Finance 

2023 estimated data are based on August 2023 projections provided by the Society of Japanese Aerospace Companies (“SJAC”). 

Despite a dramatic decrease in Japanese air travel demand due to the COVID-19 pandemic, Japan continues to offer a lucrative long-term market for imported aircraft, aircraft parts, engines, and other related technologies.  Although aircraft engine production has returned to pre-COVID levels, Japan’s production of other aircraft parts remains low.  

Market Considerations 

U.S. firms have an overwhelming presence in Japan’s aircraft and aircraft parts segment due to long-standing relationships with domestic manufacturers and trading firms – some spanning over 70 years.  Several trends are driving opportunities for U.S. firms.  For example, Japanese industry players are increasingly active in international projects, developing transport and patrol aircraft for defense initiatives and manufacturing small jets and jet engines for civil aviation.  Geopolitical considerations, including ongoing regional disputes with China, Russia, and North Korea, are also driving Japan’s demand for enhanced defense capabilities.   

Japanese customers of aircrafts and aircraft parts first consider track record and quality rather than cost competitiveness.  In many cases, U.S. firms compete against other U.S. firms for new Japan contracts.  

Civil Aircraft 

Japan’s commercial aerospace business is dominated by big companies that supply the major aircraft manufacturers – specifically Boeing.  For example, Japanese manufacturers such as Mitsubishi Heavy Industries (“MHI”), Kawasaki Heavy Industries (“KHI”), and Subaru (formerly Fuji Heavy Industries) supply about 35 percent of content for the Boeing 787 aircraft including aircraft wings, center wings, and front fuselage.  These companies also supply about 21 percent of content for the Boeing 777 such as center section, center fuselage, and aft fuselage. 

The resurgence in demand for aircraft subsequent to the COVID-19 pandemic, which suppressed air travel and demand for aircraft, has been a significant development in the aerospace sector. In 2022 aircraft and aircraft component manufactured for Boeing increased 0.3 percent from the previous year, indicating a recovery process that is underway.  While the production rate of Boeing 777 exhibits signs of convalescence, a cautious approach is being adopted and the production rate is deliberately restrained. Boeing officially announced a delay in the Boeing 777X program. The decision by the U.S. Federal Aviation Administration (FAA) to rescind the ban on Boeing 787 deliveries has served as a catalyst for gradual resurgence in Boeing 787 production.

According to Japan’s Ministry of Finance, in 2022 imports of aircraft products including parts, sub-parts, and components amounted to $8.3 billion, with U.S. aerospace products accounting for 59.6 percent of the total.    

Japan does not levy import duties on aircraft or aircraft parts.  Under the 1980 WTO Agreement on Trade in Civil Aircraft with 32 signatories, including Japan and the United States, about 250 items are duty-free provided they are used in civil aircraft or ground flying trainers.  Such items include those used in the manufacture, repair, maintenance, rebuilding, modification, or conversion of such aircraft. 

Leading Sub-Sectors 

Aircraft Engines 

Aircraft engines are a leading sub-sector.  Concerning the development of civil aircraft engines, Japan participates in international joint development projects for civil engines such as the V2500, Trent1000, GEnx, GE9X, and PW1100G-JM.  In addition, Japan develops defense engines such as F7 and XF9-1. In 2022, there was a remarkable surge in demand for engines and engine components, leading to a substantial increase of 51.7 percent in production compared to the previous year.   

Helicopters 

As the world’s fifth largest helicopter user, Japan develops and manufactures fuselages, engines, and all other helicopter components.  Japan has also developed and produced a composite-material, bearing-less version of the rotor system that makes full use of cutting-edge technologies.  In addition, the Japanese aerospace industry is proactively participating in multinational development projects such as the following: 

Participation in International Civil Helicopter Projects 

MD902 Helicopters Transmission Production  

AW139 (AgustaWestland) High-Speed Gearbox  

Events  

Japan International Aerospace Exhibition (“JA”) 

Dates:  October 16-18, 2024 

Venue:  Tokyo Big Sight 

Website: https://japanaerospace.jp/en/  

Description: Japan’s only large scale, fully integrated trade show on aerospace, defense, and space. The most recent JA was held in 2018 in Tokyo with 520 exhibitors and 20,000 visitors.  The U.S. Commercial Service Japan provided on-site counseling to U.S. exhibitors throughout the exhibition.   

Resources  

• Japan Civil Aviation Bureau under Japan’s Ministry of Land, Infrastructure, Transport and Tourism  
• Society of Japanese Aerospace Companies (“SJAC”)  
• Japan Business Aviation Association (“JBAA”)  

U.S. Commercial Service Japan Contact 

For more information about aerospace market developments in Japan and related opportunities for U.S. firms, please contact the U.S. Commercial Service at Office.Tokyo@trade.gov or Ms. Sayoko Koto at sayoko.koto@trade.gov.