Israel inks multi-billion-shekel deal to replenish Arrow 3 stocks
Israel inks multi-billion-shekel deal to replenish Arrow 3 stocks
The Arrow 3 system has been used to intercept some of the missiles launched by Houthi rebels in Yemen, as well as heavy barrages of ballistic missiles launched by Iran during its two direct attacks on Israel in April and October.
The Ministry of Defense announced on Tuesday that it has struck a major deal with Israel Aerospace Industries (IAI) to supply Arrow 3 missiles for several billion shekels. The agreement was announced one day after another significant deal for the IAI, sale of air defense systems to Slovakia, valued at about NIS 2 billion ($550M).
The massive order from the Ministry of Defense follows the extensive use of Arrow 3 missiles since the outbreak of the war. These missiles are designed to intercept ballistic missiles at long ranges, outside Israel's territory, and even beyond the Earth's atmosphere.
The Arrow 3 system has been used to intercept some of the missiles launched by Houthi rebels in Yemen, as well as heavy barrages of ballistic missiles launched by Iran during its two direct attacks on Israel in April and October.
Before the war, Israel Aerospace Industries and the Ministry of Defense signed an agreement with the German Ministry of Defense, which also acquired these missiles. The sale of the Arrow 3 system to Germany is considered the largest defense deal in Israel's history, valued at approximately NIS 14 billion. Germany is the first country to import the advanced system.
On Monday, the IAI agreed to supply the Slovak army with Barak MX air defense systems in a deal worth approximately $550 million. This marks the largest security agreement between Israel and Slovakia, a NATO member that is upgrading its air defense systems, previously reliant on Russian-made technology.
Since the outbreak of the war in Ukraine, Israeli defense industries have seen a surge in global demand for their weapon systems. For example, Finland purchased Rafael’s David’s Sling system, while Germany acquired the Arrow 3 system from IAI. Both represent the first export transactions for these advanced systems.
In 2023, Israel’s defense exports reached an all-time high of over $13 billion, an increase of $500 million compared to 2022. Air defense systems, missiles, and rockets accounted for 36% of all defense exports.
Despite the ongoing war in Israel, which has shifted significant production capacity toward equipping the IDF, Israeli defense companies continue to see unprecedented international demand. In the third quarter alone, the backlogs of major defense firms reached record levels: IAI reported $25 billion, Elbit Systems $22 billion, and Rafael $16.5 billion.
