F-35 sale boosts reciprocal procurement in Israel

F-35 stealth fighter Photo: PR

Reciprocal procurement under the F-35 purchase agreements has totaled $1.53 billion.

The Ministry of Defense today reported that Israeli companies had signed reciprocal procurement deals totaling $440 million with manufacturers of the F-35 Stealth Fighter, 40% more than the value of reciprocal procurement deals in 2017.

According to Ministry of Defense figures, since 2010, when Israel signed the first Stealth Fighters deal with Lockheed Martin, reciprocal procurement under the agreements has totaled $1.53 billion.

Figures from the Ministry of Defense Directorate of Production and Procurement (PPD) show that the defense industries increased their commercial contracts with Lockheed Martin in the framework of ventures related to the F-35 program. A joint company of Israeli company Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT) and US company Rockwell Collins that manufactures an advanced helmet used by F-35 pilots expanded its contract with Lockheed Martin to $1.12 billion. Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1) expanded its contract with Lockheed Martin for production of wings for the F-35 to $311 million. Cyclone, a subsidiary of Elbit Systems manufacturing body parts for the plane, expanded its orders by almost $50 million.

The Ministry of Defense said today that other defense industries throughout Israel were involved in producing subsystems for the F-35, including Tadiran Communications, SimiGon (LSE: SIM), Cabiran Investment Casting Solutions, Gilboa, and others, Some increased the amount of Lockheed Martin's orders for the F-35 program.

Since 2010, Israel has purchased 50 F-35 planes in three deals. The planes will be delivered in the coming years. 14 have been delivered so far, with six more slated for 2019. The IDF calls the F-35 "Adir."

Commenting today on the reciprocal procurement figures, PPD head Col. (res.) Avi Dadon said, "We are at the beginning of a decade in which mega defense procurement deals will be signed with the defense industries, based on US aid money."

Over the coming year, the IDF and the Ministry of Defense are likely to decide on the procurement of another battle squadron of either advanced F-15s made by Boeing or F-35s made by Lockheed Martin. Procurement of new advanced refueling planes and transportation helicopters amounting to billions of dollars is also imminent.

Published by Globes, Israel business news - en.globes.co.il - on December 30, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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F-35 stealth fighter Photo: PR
F-35 stealth fighter Photo: PR
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