The German Bundestag has approved an expansion of the Arrow 3 defense system contract with Israel, valued at approximately $3.1 billion, which will complement the initial purchase agreement signed by Israel and Germany approximately two years ago, valued at roughly $3.5 billion, Israel's Defense Ministry announced on Wednesday.
Together, the Arrow agreements, signed by the ministry and the German Federal Ministry of Defense (BMVg), total approximately $6.5 billion, representing the largest Israeli defense export deal ever.
The announcement comes only two weeks after the initial Arrow 3 battery Israel provided to Germany was deployed at a major ceremony at Holzdorf Air Force Base, attended also by The Jerusalem Post.
As part of the contract expansion, the ministry said that it and the BMVg "have agreed to significantly increase the production rate of Arrow 3 interceptors and launchers to be supplied to Germany, substantially enhancing its air and missile defense capabilities."
Israel-Germany Arrow project
For years, successive defense ministers have worked on the Israel-Germany Arrow project, with former minister Yoav Gallant signing a final deal, Director General Maj. Gen. (Res.) Amir Baram repeatedly visiting Germany, and Baram and Defense Minister Israel Katz focusing on expanding defense exports to significantly enhance the IDF's force build-up and strengthen Israel's defense industry and economy.
The latest contract expansion will be signed on Thursday in Germany, led by Director of the Israel Missile Defense Organization (IMDO) within the Ministry’s Directorate of Defense Research and Development (DDR&D), Moshe Patel, and the Director General of the German Federal Office of Bundeswehr Equipment, Information Technology and In-Service Support, Annette Lehnigk-Emden.
Other representatives of the IMOD, the BMVg, and Israel Aerospace Industries (IAI, the main producer of the Arrow, will also be in attendance.
Baram said, “The Arrow 3 contract expansion represents another significant milestone in our deepening strategic partnership with Germany, our key European ally. This landmark deal, valued at over $3 billion, embodies the IMOD’s strategy to expand defense exports."
Head of the DDR&D, Brig. Gen. (Res.) Dr. Daniel Gold stated, “This represents significant confidence in the IMOD, Israel’s defense industry, and our bilateral relationship. The Arrow system, a cornerstone of Israel’s multi-layered air defense architecture that protected our citizens throughout this war, now stands guard over German skies."
IAI President and CEO, Boaz Levy added, “IAI’s pivotal role in Germany’s air defense array and the trust established with the German government were recently demonstrated during the delivery of the Arrow 3 system, just two years from contract signing."
"The mutual trust, advanced technological capabilities - as proven in operational deployment - and adherence to timelines all led the German government to approve the follow-on procurement of the Arrow air missile defense system," said Levy.
Berlin's historic deployment of Israel's Arrow 2 and 3 defense systems in early December will pave the way for additional European countries to purchase the system, German Air Defense Commander Col. Dennis Kruger told the Post in an exclusive interview at the time.
Asked if additional European countries will also purchase the Arrow from Israel, he responded, "I believe so. Germany has closed the capability gap. But [there are threats] for all over Europe. Germany is moving in first and setting a good example. We believe other nations will follow."
He added that Germany would want to purchase the Arrow 4 and 5 in the future when they become operational, though that is expected to be some years off.