Japan Bars Kawasaki Heavy Industries from Defense Contracts After Long-Running Engine Test Fraud

The Ministry of Defense of Japan has issued a disciplinary measure against Kawasaki Heavy Industries (KHI), temporarily disqualifying the company from bidding on defense contracts, as it was discovered to have cheated in submarine engine tests over a span of more than three decades. 

On December 26, the ministry announced that KHI would no longer be allowed to participate in defense tenders from December 26, 2025, until March 11, 2026, due to the falsification. The relocation is after an elaborate investigation that debunked the shipbuilder’s repeatedly reported engineered performance data, which had also been modified to fit the needs, instead of the actual results of real tests. 

According to government investigators, the substitution of target values with real figures on fuel consumption took place in the land-based testing of submarine diesel engines, which were shipped to the Japan Maritime Self-Defense Force (JMSDF). Even though the officials stated that the falsified data did not affect the safety and the fundamental functioning of the engines, a considerable number of the engines failed to pass the required fuel efficiency markers.

The investigation by the defense ministry revealed that the malfunctions could be dated to 1988 and went on till the year 2021, with up to 66 engines that were employed in virtually the entire active submarine force. The 24 submarines that were in service had 23 of them equipped with engines that were connected to the forged inspection reports. 

Due to the sanctions, KHI has apologized and proposed improvements to the internal compliance and monitoring. The company management recognized the fact that the misconduct was taken seriously and that steps are being formulated to ensure that the future is free of such problems.

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