(Communicated by the Israel Ministry of Defense Spokesperson)
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. Together, the Arrow agreement, signed by the Israel Ministry of Defense (IMOD) and the German Federal Ministry of Defense (BMVg), totals approximately $6.5 billion, representing the largest Israeli defense export deal ever.
As part of the contract expansion, the IMOD 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.
Under the IMOD’s strategy led by Defense Minister, Israel Katz, and IMOD Director General Maj. Gen. (Res.) Amir Baram, the expansion of defense exports – including the Arrow contract – will significantly enhance the IDF’s force build-up and strengthen Israel’s defense industry and economy.
The contract expansion is expected to be signed tomorrow (Thursday, 18 December 2025) 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, with participation from representatives of the IMOD, the BMVg, and Israel Aerospace Industries (IAI).
The Arrow 3 system, which has demonstrated impressive operational capabilities during the war with dozens of successful interceptions, is jointly developed and produced by the IMOD’s DDR&D and the U.S. Missile Defense Agency (MDA). IAI serves as the prime contractor for the development and production of the Arrow aerial defense system.
Defense Minister, Israel Katz: “The Bundestag’s approval of the Arrow 3 contract expansion is a clear expression of Germany’s profound confidence in Israel, our technological capabilities, and our shared commitment to protecting our citizens against escalating threats. This represents a first-tier strategic partnership rooted in a long-term defense strategy. The revenues from this deal will enable continued advanced strategic developments, strengthen the IDF’s force posture, and ensure Israel’s qualitative edge in the years ahead against our adversaries – while deepening our defense cooperation with strategic partners across Europe and globally.”
IMOD Director General, Maj. Gen. (Res.) Amir Baram: “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. The agreement will reinforce Israel’s position as a global security leader, accelerate Arrow production for the IDF, and channel billions into strengthening our defense industrial base and advancing next-generation air defense capabilities.”
Head of the DDR&D, Brig. Gen. (Res.) Dr. Daniel Gold: “I welcome the signing of the Arrow 3 contract expansion with Germany. 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. We remain committed to fulfilling this critical mission.”
IAI President and CEO, Boaz Levy: “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. The close defense cooperation between our two countries is based on mutual responsibility, shared values, and a joint commitment to the protection of civilian lives, serving as a solid foundation for the development of additional advanced solutions to address evolving threats. This strategic partnership will undoubtedly provide Europe as a whole with some of the most advanced air defense capabilities in the world.”
Attached for your use: Photos from the ceremony marking the initial operational capability handover of the Arrow 3 system to Germany, held earlier this month.
