A Japanese government investigation has found that 118 orders for U.S. military equipment worth 1.14 trillion yen, or about $7.21 billion, remain undelivered at least five years after contracts were signed, in some cases forcing Japan’s Self-Defense Forces to continue operating outdated systems. The findings have renewed scrutiny of Japan’s reliance on U.S. arms procurement as it accelerates a historic military buildup.
Japan’s Board of Audit said it completed its investigation into delivery delays on Friday and urged the Defense Ministry to improve coordination with Washington to prevent disruptions to SDF operations. The probe examined purchases made through the U.S. Foreign Military Sales program, a framework under which allied countries buy American-made weapons and equipment via the U.S. government.
In a statement, Japan’s Defense Ministry said the 118 cases identified by the audit included some orders that were expanded after the original contracts were signed and stressed that not all represented delayed deliveries. It said it would address each issue individually within the FMS process.
Under the FMS system, purchasing countries pay in advance for equipment, with prices and delivery schedules provided only as estimates at the time of contract. A final settlement is made after delivery, with any surplus funds returned by the United States. While the arrangement allows access to advanced U.S. technology, it also leaves buyers exposed to production delays and shifting priorities in Washington.
At the request of parliament, the Board of Audit reviewed the status of FMS contracts and deliveries covering fiscal years 2018 through 2023. Of 519 contracts that had failed to meet delivery deadlines by the end of fiscal 2018, 118 were still outstanding five years later, as of the end of fiscal 2023. The audit said many of the delays stemmed from the time required for the U.S. government to finalize contracts with manufacturers after receiving Japan’s orders, as well as subsequent changes to production plans.
One example cited involved the Air Self-Defense Force’s procurement of maintenance equipment for E-2D early warning aircraft stationed at Misawa Air Base in northern Japan. Four contracts worth 139.8 billion yen were signed with delivery originally planned for fiscal 2019 to 2020. Those deliveries were later postponed to fiscal 2024 or beyond due to circumstances at the manufacturer, forcing the unit to rely on equipment designed for older E-2C aircraft.
The audit also noted structural risks in the FMS system. Even when contracts are in place, deliveries can be delayed if the U.S. military lacks the equipment in stock. Shipments to Japan may also be postponed if Washington determines that fulfilling foreign orders would interfere with American military operations, a concern that has grown amid heightened global demand for weapons.
Japanese opposition parties have warned that deliveries of air defense missiles and other key systems could be affected by the impact of Russia’s invasion of Ukraine, which has driven the United States to prioritize supplies for Kyiv. The Japanese government has said it is difficult to assess the likelihood of such delays.
In addition to delivery problems, the audit highlighted the financial risks posed by currency fluctuations. Because FMS contracts often involve long-term installment payments, a depreciation of the yen after contracts are signed increases Japan’s overall burden. The Board of Audit estimated that the recent weakening of the yen has raised Japan’s payment obligations for fiscal years 2023 to 2025 by about 300 billion yen compared with initial projections.
Despite the challenges, Japan views the FMS program as indispensable, particularly for acquiring cutting-edge systems that are difficult to produce domestically. As Tokyo moves to significantly boost defense spending in response to regional security threats, reliance on U.S. procurement has deepened. FMS purchases totaled 1.38 trillion yen in fiscal 2023, more than three times the level recorded in fiscal 2018, underscoring both Japan’s expanding defense ambitions and its growing exposure to delays and rising costs.
