U.S. Navy awards BAE $62M contract to upgrade E-2D Hawkeye intelligence aircraft.

BAE Systems won a $62.4 million Pentagon contract to provide test systems and support for the U.S. Navy’s E-2D Advanced Hawkeye fleet. The deal enhances the aircraft’s early warning and battle management capability.

The U.S. Department of Defense announced Sept. 18, 2025, that BAE Systems in Greenlawn, N.Y., has secured a $62.4 million contract to support the Navy’s E-2D Advanced Hawkeye intelligence aircraft program. The award covers design, development, and fabrication of Identification Friend or Foe (IFF) test systems, specialized repair equipment, and full logistics documentation.
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A U.S. Navy E-2D Advanced Hawkeye conducts flight operations from an aircraft carrier, showcasing its distinctive rotating radar dome and role as the fleet's premier airborne early warning and command and control platform. (Picture source: U.S. Department of War)

This new contract underscores the U.S. Navy’s strategic focus on enhancing the E-2D Advanced Hawkeye’s ability to identify and track aircraft in complex and contested airspaces. The IFF system is a critical component of the U.S. Navy’s situational awareness and airspace deconfliction capability, enabling positive identification of friendly platforms during multi-domain operations. The operational test program sets (OTPS) produced under this award will allow the U.S. Navy to evaluate and certify the performance and reliability of upgraded IFF systems before they are fielded across the fleet.

The five units under test, which simulate combat-realistic conditions, will be deployed in support of test squadrons tasked with validating new configurations and addressing previously reported technical shortcomings. The inclusion of specialized test equipment and repair solutions ensures that U.S. Navy maintenance units can conduct rapid diagnostics and corrective actions at both the organizational and depot levels, reinforcing overall fleet readiness.

The E-2D Advanced Hawkeye, manufactured by Northrop Grumman, is the U.S. Navy’s premier carrier-based airborne early warning and battle management platform. Outfitted with the AN/APY-9 radar and AN/APX-122A IFF interrogator, the aircraft plays a central role in integrated air and missile defense, long-range surveillance, and command and control of carrier strike group operations. The IFF capability is essential in distinguishing between friendly and unknown contacts, particularly in congested or contested battlespaces involving joint and coalition forces.

Recent oversight by the U.S. Department of War Inspector General has identified lingering deficiencies in the E-2D’s electronic systems, including interoperability and system integration concerns. This contract with BAE Systems appears to be a targeted response to those findings, enabling the U.S. Navy to accelerate the resolution of key performance gaps before broader deployment of upgraded E-2D aircraft.

The firm fixed price portion of the contract covers hardware fabrication, while the cost plus fixed fee segment allows for iterative design and testing. This structure supports both fiscal discipline and engineering flexibility, allowing the U.S. Navy to adjust technical requirements based on testing outcomes. The data and procedures delivered under the contract will also feed into the broader logistical and sustainment pipeline for the E-2D program, which remains one of the most complex and strategically critical aviation efforts in the U.S. Navy inventory.

This latest award further cements BAE Systems’ role as a key supplier of IFF technologies to the U.S. Department of War. With an existing portfolio that includes digital beamforming, advanced interrogation systems, and multi-mode sensor integration, the company continues to play a foundational role in evolving U.S. Navy airborne sensor architecture.

As the U.S. Navy prepares for potential high-end conflict scenarios in the Indo-Pacific and other forward theaters, ensuring that all fleet platforms, including the E-2D Advanced Hawkeye, are equipped with the most advanced identification technologies will be central to mission success. The operational test units delivered under this contract may shape the future baseline for IFF integration across not only the E-2D but potentially other U.S. Navy aviation assets operating within joint all-domain command and control environments.

Written by Alain Servaes – Chief Editor, Army Recognition Group
Alain Servaes is a former infantry non-commissioned officer and the founder of Army Recognition. With over 20 years in defense journalism, he provides expert analysis on military equipment, NATO operations, and the global defense industry.