Despite the recent downgrading of Israel’s credit rating by both Moody’s and S&P, the Israeli defense industry shows no signs of slowing down. The sector continues to thrive, unveiling new projects, securing substantial contracts, and maintaining a strong outlook for 2025 and beyond. This resilience reflects the industry’s critical role in Israel’s economy and its national security framework, even as broader economic concerns arise.
Elbit Systems Secures Major Contracts
Elbit Systems, one of Israel’s leading defence contractors, is at the forefront of this momentum. It recently secured a contract worth hundreds of millions of dollars for the installation of its “Durvan Arrow” active defence systems on American Bradley APCs destined for Ukraine. The U.S. Department of Defence signed a $191.2 million deal with General Dynamics for this project, set to continue until 2027. Funding for the contract will come from U.S. military aid designated for Ukraine, replacing older Bradley APCs with advanced, protected models.
The Durvan Arrow, an advanced “hard defence” system, enhances the self-defence capabilities of armoured vehicles against a wide range of threats, including anti-tank rockets and drones. Its compact design and low energy requirements make it a standout in the global defence market. Elbit Systems’ deal follows a previous $130 million contract with BAE Systems for the installation of Durvan Arrow systems on European APCs.
Credit: Elbit Systems Ltd
Orbit Technologies Expands Naval Contracts
Orbit Technologies, another key player in Israel’s defence landscape, announced a $3 million order for its OceanTRx4 Mil satellite communication systems. This contract, secured with a leading European defence integrator, strengthens Orbit’s position in the naval military platform sector. The systems, which will be delivered by 2025, are designed for marine platforms and offer cutting-edge satellite communication solutions.
Orbit’s expertise extends beyond naval applications, providing communication systems for vital security missions across air and sea. Its client list includes industry giants like Boeing, Lockheed Martin, and over 27 navies worldwide.
Beit Shemesh Engines Thrives in Aviation
Beit Shemesh Engines continues to grow in the global aviation sector, signing a long-term agreement with American aviation engine manufacturer Pratt & Whitney. The contract, spanning from 2024 to 2030, with an option to extend, is valued at $205 million, with the potential to reach $280 million. The deal expands Beit Shemesh’s role in supplying components for some of the most advanced aviation engine programs, solidifying its position in the aerospace industry.
Aerospace Industry Opens New Factory in Ofakim
The Israel Aerospace Industries (IAI) recently inaugurated a new electronic manufacturing plant in Ofakim, in the Negev, at a cost of NIS 50 million. The “Ofek” plant, aimed at supporting IAI’s continued technological development, represents both business growth and a commitment to regional development. The factory is expected to bring new job opportunities and investment to the area, supporting the local economy while enhancing IAI’s production capabilities.
IAI executives emphasized the plant’s importance not only as a business venture but as a national priority. The investment highlights the role of Israel’s defence industries in securing the country’s future, particularly in the face of shifting global alliances and security challenges.
Despite the economic challenges reflected in the downgraded credit rating, Israel’s defence industry is not just weathering the storm but thriving. Its technological expertise, robust contracts, and strategic importance to national security make it a pillar of Israel’s economic and geopolitical strength.
Image credit: IronVision, Elbit Systems
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