Bombardier Defense Soars on Global Surveillance Demands

The defense aviation sector is undergoing a quiet revolution, driven by governments worldwide modernizing their fleets to counter evolving threats. At the heart of this trend is Bombardier Defense, which has emerged as a critical partner for nations seeking advanced airborne mission platforms. A recent firm order from Swedish defense giant Saab for two Bombardier Global 6500 aircraft—to be integrated with Saab's GlobalEye surveillance system—spotlights Bombardier's strategic growth and underscores its position as a leader in high-end special-mission aircraft.

The Catalyst: Saab's GlobalEye Deal

In June 2025, Bombardier secured a SEK1.1 billion (USD$115 million) contract to supply two Global 6500 aircraft to Saab, marking a critical step in Sweden's defense modernization. These aircraft will replace aging Gulfstream models and serve as VIP transports while also complementing Sweden's three GlobalEye AEW&C (Airborne Early Warning & Control) platforms, slated for delivery by 2027. The partnership exemplifies Bombardier's expertise in crafting versatile aircraft that governments can repurpose for specialized missions.

The Global 6500's 6,600-nautical-mile range, Mach 0.9 speed, and ability to operate at high altitudes make it ideal for surveillance, search-and-rescue, and maritime patrol. Its advanced avionics and modular design allow seamless integration with systems like Saab's Erieye ER radar, which can detect airborne targets up to 450 km away and track ships and ground movements across domains.

Why Bombardier Stands Out

Bombardier's 50-year track record in special-mission aircraft—including over 500 platforms delivered globally—gives it a leg up in an industry where reliability and scalability matter. The Global 6500's versatility is unmatched: it can be configured for VIP transport, reconnaissance, or AEW&C roles, reducing operational complexity for militaries. For Sweden, this means a unified fleet that simplifies logistics and training.

The Saab deal also highlights Bombardier's expanding ecosystem of partners. A framework agreement with Sabena technics, a French aircraft modification firm, ensures Bombardier can scale production to meet rising demand. This is critical as countries like France (which has signed a declaration of intent for up to four GlobalEye systems) and Canada (exploring AEW&C upgrades) seek sovereign control over surveillance capabilities.

A Booming Market for Airborne Surveillance

The GlobalEye's success is no accident. The global airborne early warning market is projected to grow at a 6% CAGR through 2030, driven by modernization programs in NATO and Indo-Pacific nations. Legacy systems like the E-3 Sentry are nearing retirement, and rivals like Boeing's E-7A face competition from the GlobalEye's European origins and Bombardier's production flexibility.

Saab's GlobalEye has already secured orders from Sweden, France, and the UAE, with potential bids in Nordic pooled fleets and Australia. Bombardier's role as the airframe supplier positions it to capitalize on this demand. Each GlobalEye system requires a customized Global 6000/6500 aircraft, and with Saab targeting four units per year by 2030, Bombardier's defense backlog could expand significantly.

Data to show backlog growth from SEK billions to reflect rising demand.

Investment Implications

Bombardier's defense division is a hidden gem. While its commercial aviation segment faces headwinds, the defense unit's margins are higher, and its order backlog is growing. The Saab deal adds to a pipeline that includes Canada's AEW&C requirement (where Bombardier's Canadian-built aircraft offer domestic industrial benefits) and France's E-3 replacement program.

Investors should watch for two catalysts:
1. Final contract signing with France (expected late 2025), which could add SEK2-4 billion to Bombardier's backlog.
2. GlobalEye orders from Nordic allies, which could leverage Sweden's 2027 deliveries to spur regional pooled procurement.

Risk factors: Geopolitical delays, supply chain constraints, or a slowdown in defense spending. However, the long-term trend of modernization spending—projected to exceed $2 trillion annually by 2030—supports Bombardier's upside.

Conclusion: A Strategic Bet on Defense Modernization

Bombardier Defense's partnership with Saab is more than a single contract—it's a blueprint for the future of airborne surveillance. With its adaptable airframes, proven track record, and strategic alliances, Bombardier is well-positioned to capture a growing share of a $15 billion+ AEW&C market. Investors seeking exposure to defense modernization should take note: Bombardier's defense division is a sleeper stock with asymmetric upside as governments prioritize air domain awareness.

Data to show underperformance relative to peers, signaling valuation upside.

Actionable idea: Consider a position in BBD.TO with a 12–18-month horizon, targeting a valuation re-rating as defense orders flow in. The Saab deal is just the start—watch for more GlobalEye wins to fuel growth.