Japan's Drone Race: Ditching China for Domestic Defense

Japan is significantly ramping up its domestic drone production capabilities, aiming to decrease its dependence on Chinese manufacturers. This strategic move is driven by concerns over China's current dominance, holding approximately 90% of the global industrial drone market, which Tokyo perceives as a strategic vulnerability.

Several Japanese defense startups, including Eams Robotics and Terra Drone, are transitioning from their civilian projects to focus on military drone manufacturing. Eams Robotics, which began in aerial photography, is developing autonomous flight systems and reportedly considering partnerships with American defense firms. Terra Drone is focusing on mass-producing Japan-made batteries for drones, a critical component currently lacking a domestic defense-grade supplier.

The Japanese government has substantially increased its budget for unmanned defense systems, allocating 277 billion yen (~$1.72 billion) this year, a significant rise from 111 billion yen (v$705 million) in 2025. The ruling Liberal Democratic Party has also approved a plan to produce around 80,000 drones annually by 2030. These efforts are partly in response to lessons learned from conflicts like the one in Ukraine and concerns over potential delays in U.S. missile deliveries.