Sources inform “Globes” that the price of the Arrow anti-ballistic missile system would not be cheaper if production were transferred to Boeing (NYSE:BA) in the US.
Each Arrow anti-missile missile would still cost $3 million, Ministry of Defense Armaments Research and Development Administration head Maj.-Gen. (res) Yitzhak Ben-Yisrael recently revealed. The Israel Air Force has deployed two operational Arrow batteries. The procurement of a third battery has been delayed, due to financial constraints.
Last month, Israel Aircraft Industries, which manufactures the Arrow, and Boeing signed a deal to manufacture the missile in the US. The main reason was to lower production costs, which would enable the IDF to expand its operational deployment of the system.
IAI produces the Arrow at its MALAM plant in Beer Yaakov. Boeing will produce only the missile at its plants in California and elsewhere in the US, but would not build the other components of the system. The Green Pine radar is built by Elta Electronics Industries in Ashdod, and Tadiran Electronic Systems produces the Citron Tree fire control system. The complete Arrow system is assembled in Israel.
A source at the Ministry of Defense “Wall” Arrow development program told “Globes” that although the price would remain the same, production by Boeing would provide other benefits. Most importantly, Israel could use US military aid to buy the system. The US permits military aid to be used to finance the procurement of systems that meet the “Made in USA” requirement, i.e. at least half the system is built within the US.
Boeing and IAI have spoken positively about selling the Arrow to third countries. The US administration would have to approve any such sale. Japan, South Korea, India and Turkey have expressed interest in the Arrow, the world’s first anti-ballistic missile with proven interception capability.
Although West Coast senators support procurement of the Arrow to defend against North Korean ballistic missiles, the US has no plans to buy the Israeli missile system.
Published by Globes [online] - www.globes.co.il - on March 6, 2003