Tel Aviv: Israel Aerospace Industries (IAI) announced January 11 that it signed a contract valued at approximately around $ 3.1 billion with Israel’s Ministry of Defence (IMOD) for the expansion of Germany’s procurement of the Arrow 3 air missile defence system. This announcement follows the IMOD’s announcement dated December 17, 2025, regarding the signing of the agreement with the German Federal Ministry of Defence.
IAI President and CEO, Boaz Levy, said, “This follow-on contract with Germany, expanding the procurement of the Arrow 3 system represents another mega deal for Israel Aerospace Industries and for the State of Israel, reflecting the deep vote of confidence in IAI’s capabilities, in Israeli technology and the strategic partnership between our two countries. Delivering an advanced air missile defence system that has been tested and operationally proven, while meeting demanding timelines, significantly enhances Germany’s missile defence capabilities against evolving threats. This cooperation is based on shared values and a mutual commitment to protect civilian lives and serves as a foundation for the development of the next generation of air and missile defence systems. I would like to thank IMOD and the Homa Directorate for their close cooperation that led to the signing of this follow-on contract, together with our partners at the German Federal Ministry of Defense and the US Missile Defence Agency (MDA).”
The total value of the Arrow 3 contract is expected to exceed $ 6.5 billion, making it the largest defence export deal in the history of the State of Israel. The agreement will enhance the air and missile defence capabilities of both Germany and Israel.
The Arrow 3 air missile defence system was developed by Israel Aerospace Industries, as the prime contractor for the system’s development and production, and in cooperation with Israel’s Ministry of Defence’s, Homa Directorate within the Directorate of Defence Research and Development (DDR&D), and the US Missile Defence Agency (MDA).
