Elbit CEO: "France is a big competitor of ours, and its behavior is brutal and hypocritical"
Elbit CEO: "France is a big competitor of ours, and its behavior is brutal and hypocritical"
Bezhalel Machlis attacked the restrictions imposed by France, whose presidential plane is secured by the Israeli SkyShield system. Elbit doubled its sales to the Israeli market in the third quarter.
In the belly of the A-330 plane used by French President Emmanuel Macron in his travels around the world, the Magen Rakia (SkyShield) defense system by Elbit Systems is installed. It protects him from shoulder-launched missiles using a laser beam that diverts them from their course and rescues the secure presidential plane from a catastrophe on an international scale. The development of this unique defense system began following an attempt in 2002 to hit a passenger plane that took off from Mombasa airport in Kenya to Israel. Terrorists launched two shoulder-fired missiles at the aircraft. Although the missiles missed, avoiding a major disaster, the potential threat was well understood in Israel. Today, every plane used by Israeli airlines El Al, Arkia, and Israir must carry SkyShield under a requirement from the Civil Aviation Authority.
While Macron’s plane is protected by one of the flagship systems of the Israeli company Elbit, he proves time and time again that he has no problem acting against it to restrict its movements and even torpedo its potential deals as a means of pressuring Israel to end the war in Gaza. His country, the traditional host of the world's most prestigious arms exhibitions, has been working vigorously to keep Israeli companies away from these events since the outbreak of the Gaza war.
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President Macron, Bezhalel Machlis
(Photos: Asaf Shilo / Yisrael Sun, Udovic Marin/ AFP)
This began with the exclusion of Israeli defense companies from the Eurosatory land-based weapons exhibition in June, continued with the naval weapons exhibition Euronaval earlier this month, and now casts a shadow on the upcoming Paris Air Show in June 2025 at Paris–Le Bourget Airport, the world's most important arms exhibition.
Buying weapons through the back door
Macron's dual attitude towards Elbit reflects Europe's overall stance on Israeli weapons. While European countries make it difficult for Israeli companies to acquire raw materials necessary for arms production—and some even threaten Israel with an arms embargo—they simultaneously purchase precision rockets, missile defense systems, and drones from Israeli companies as part of their military strengthening efforts following Russia's invasion of Ukraine.
Yesterday, Elbit Systems reported a significant deal exceeding $350 million to sell long-range rocket systems and Hermes-900 drones to a European country. The country remains unnamed in Elbit's reports due to political sensitivities, as many European nations criticize Israel's actions in Gaza while secretly purchasing its precision weapons.
In response to Calcalist's questions, Elbit CEO Bezhalel Machlis commented on the French boycott, estimating it as an attempt to improve the competitive position of French defense companies relative to Israeli companies. "The French are major competitors of the Israeli industries, and by preventing us from attending exhibitions, they seemingly strengthen their position. Smart people know how to read the picture in a broad way. This is brutal, unjustified, and hypocritical behavior. We do not sell or buy almost anything from France, but these exhibitions are opportunities for meetings with customers and suppliers. However, what is not done there will be done elsewhere. In my opinion, they will lose out from these moves because any blatant and unbalanced step will eventually backfire on them," he said.
France’s double standards amid Elbit’s growth
Against the backdrop of French hypocrisy and the double standards preached by some European countries to Israel, the IDF was Elbit's primary customer in the third quarter of this year. Sales to the Ministry of Defense totaled around $500 million, accounting for about one-third of Elbit's total quarterly sales. In the first nine months of 2024, sales to the Israeli Ministry of Defense reached $1.4 billion, driven by the wars in Gaza and Lebanon that have lasted over 13 months.
Most of Elbit's domestic sales are munitions produced by its land division, whose sales surged 24% compared to the same quarter last year, reaching $422 million. The 7% increase in drone sales was attributed to the IDF's extensive procurement of weapon systems amid fighting on multiple fronts. During the third quarter, Elbit doubled its domestic sales compared to the corresponding quarter, while ramping up production across its facilities, including at IMI subsidiary plants in Ramat Hasharon. It also began initial operations at its new industrial complex in Ramat Beka, which is expected to reach full production capacity by late 2025. At the end of this month, Elbit is set to inaugurate a new plant in Modi'in to expand drone production capabilities, focusing on Hermes-450 and Hermes-900 models.
"In the past year, we have increased production outputs tenfold on some of our lines," said Machlis. This comes as Elbit’s third-quarter sales climbed 14% to $1.71 billion, surpassing forecasts of $1.6 billion. Since the second quarter of this year, Elbit’s order backlog has grown by $1 billion, reaching a record $22.1 billion, with 37% of it to be fulfilled by the end of next year and 66% of orders coming from abroad.
Apart from this week’s rocket and drone deal in Europe, Elbit recently received a $200 million order from the Ministry of Defense to develop and produce the Magen Or (Iron Beam) laser defense system alongside Rafael. While Elbit has already begun production in its new Ramat Beka facility, production in the IMI factories in Ramat Hasharon will continue for years to meet the IDF's enormous demand for munitions. Although Elbit was supposed to vacate the IMI site earlier this year, the Ministry of Defense requested its continued operation. This has led to a dispute with the Ministry of Finance, which threatens penalties for the delayed handover. However, Machlis indicated a potential resolution that aligns with national defense needs.
Machlis added, "Besides the significant growth in the Israeli market, Elbit is growing across all segments and markets for the third consecutive quarter," supporting his forecast that the company will exceed its $7 billion sales target for 2026, with a projected operating profit of 10%. In the third quarter, Elbit’s operating profit margin was 8.2%, while total sales for January to September reached $5 billion. This comes after the company ended 2023 with $6 billion in sales.
