- Canada’s 2025 budget allocates C$73 billion to defence modernization, creating major opportunities for aerospace firms like Bombardier (TSX:BBD)
- Bombardier’s Defence division, launched in 2022, is expanding into military and special mission aircraft, aligning with NATO-driven procurement needs
- Analysts project defence revenues could hit US$1–1.5 billion by 2030, supported by AEW&C programs, partnerships, and Canada’s Arctic sovereignty initiatives
- Bombardier stock (TSX:BBD) last traded at C$197.94
Canada’s 2025 federal budget marks a historic pivot toward defence and industrial investment, and few companies are better positioned to capitalize on this shift than Bombardier (TSX:BBD). With Ottawa committing C$73 billion in defence spending by the end of the decade—and a NATO pledge to raise defence outlays to 5 per cent of GDP by 2035—Bombardier’s growing defence segment stands at the center of a generational opportunity.
Why Bombardier is in the sweet spot
Bombardier is traditionally known for its business jets, but since launching Bombardier Defence in 2022, the company has been aggressively expanding into military and special mission aircraft. CEO Éric Martel recently stated that defence and services could account for half of Bombardier’s total sales within a decade, a dramatic shift from today’s 75 per cent reliance on business jets.
Key catalysts include:
- Airborne Early Warning & Control (AEW&C) opportunities: Analysts expect Canada to procure new AEW&C aircraft, with Bombardier’s Global 6000/6500 platform—already integrated into Saab’s GlobalEye system—seen as a leading contender. This could unlock contracts worth hundreds of millions.
- Smart partnerships: Bombardier is collaborating with General Dynamics Mission Systems–Canada on next-generation multi-mission aircraft, reinforcing its role in Canada’s defence industrial base.
- Global expansion: Talks with Saab (OTC Pink:SAABF) to assemble Gripen E fighter jets in Canada could position Bombardier as a linchpin in NATO supply chains, creating high-skilled jobs and billions in economic impact.
Budget tailwinds
Budget 2025 allocates C$30 billion in capital defence spending as part of a broader C$81.8 billion modernization plan, including new aircraft, surveillance systems, and Arctic sovereignty initiatives. These priorities align perfectly with Bombardier’s capabilities in long-range, high-endurance platforms.
Analyst confidence
National Bank Financial maintains an “Outperform” rating on Bombardier with a price target of US$115, citing defence as a key growth lever. The firm projects Bombardier Defence revenues could reach US$1.0–1.5 billion by 2030, driven by AEW&C programs and aftermarket military services.
Bombardier recently ended Q3 with a strong showing of revenue at US$2.3 billion, up by 11 per cent YoY. Services revenue reached US$590 million, up by 12 per cent YoY.
Investor corner
Bombardier is no longer just a business jet manufacturer—it’s evolving into a dual-use aerospace powerhouse. With Canada’s defence spending surge, NATO commitments, and Bombardier’s strategic partnerships, the company is poised for long-term growth in a sector backed by government dollars and global security trends.
For investors seeking exposure to Canada’s defence renaissance, Bombardier offers a compelling mix of established aerospace expertise and emerging military opportunities.
About Bombardier
Bombardier builds jets for businesses, governments and militaries around the world. The company’s customers operate a fleet of more than 5,100 aircraft supported by 10 service facilities across six countries. Manufacturing activities are based in Canada, Mexico and the United States.
Bombardier stock (TSX:BBD) last traded at C$197.94 and has added 84.13 per cent year-over-year.
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