As Russia continues its war in Ukraine, Israeli defense giants are expecting to see a rise in sales to European countries in the coming years as they modernize their militaries to face future threats.
On Monday, Elbit Systems announced that it was awarded a contract to provide the Swedish Armed Forces with M339 120-mm. ammunition and Data Setting Units for the northern European country’s Leopard main battle tanks.
The M339 round is a high-accuracy, multipurpose 120-mm. tank ammunition that complies with NATO and US military standards. It has been in use by the IDF since 2015 as the main munition for Merkava tanks and is highly effective against enemy targets within dense urban areas, including buildings.
The contract, worth approximately $27 million, will be fulfilled over a period of 10 months.
The sale of the munitions to Sweden is just the latest in European arms purchases from Israel in recent years and is the beginning of what could be some of the more profitable sales in many years.
Even before Russia invaded Ukraine last month, arms sales to Europe jumped compared to the previous five-year period, the Stockholm Peace Research Institute (SIPRI) found in a recent report.
While global trade in major arms declined by 4.6%, according to the report, imports of major arms by European states were 19% higher from 2017 to 2021 than from 2012 to 2016, and accounted for 13% of global arms transfers.
The largest arms importers in Europe were Norway (an increase of 343%), the Netherlands (116%) and the United Kingdom (74%).
“The severe deterioration in relations between most European states and Russia was an important driver of growth in European arms imports, especially for states that cannot meet all their requirements through their national arms industries,” said Pieter D. Wezeman, senior researcher with the SIPRI Arms Transfers Program. “Arms transfers also play an important role in transatlantic security relationships.”
Following the outbreak of the war, European countries – including Germany, Sweden and Norway – announced that they would be sending arms to Kyiv. But those same countries are also looking to increase their weapons stockpiles, in case they are the next in line.
Israel has already sold billions of dollars worth of weapons systems to Eastern European countries fearing Russian aggression since it annexed the Crimean Peninsula in 2014. In 2021 Israel’s defense exports reached $8.3 billion, with 30% going to Europe.
The sales included missiles, rockets, air defense systems, communication, drones, intelligence systems, radar and early warning systems, ammunition and armament, manned aircraft, avionics, observation equipment and optronics.
In one deal last year, the Czech Republic purchased the SPYDER air defense system from Rafael Advanced Defense Systems in a deal worth $630m.
In 2019 Prague bought eight radar systems in another deal worth $125m. from Israel Aerospace Industries (IAI) subsidiary Elta Systems. The ELM-2084 multi-mission radars are used in Israel’s Iron Dome, David’s Sling and Barak missile systems.
Hungary later bought the same radar in a deal believed to be larger than the one signed with the Czechs, around $200m.
While Israel placed 10th overall as an arms exporter in 2021 in the SIPRI report, sources told The Jerusalem Post that the geopolitical situation in Europe has made it so that defense companies will very likely see a large increase in sales in the coming years.
Systems such as precision-guided missiles, air defense systems, unmanned aerial vehicles, and communication systems that are stopping the Russian military in its treads will be on the shopping list of European countries that are modernizing their militaries against modern threats.
Dr. Uzi Rubin, an expert in missile threat and missile defense and founder of the Israel Missile Defense Organization, told the Post that one weapon that European nations will likely purchase more of is Rafael’s Spike anti-tank missile.
“Europe is already a good customer in anti-tank missiles. Several armed forces have bought the Spike, and they can buy even more,” he said.
Rafael has already sold the Spike fifth-generation anti-tank guided missile (ATGM) to 18 European Union and NATO members.
The Israeli missile, which is capable of penetrating nearly a meter (39 inches) of armor, can be operated in either a direct attack or midcourse navigation based on target coordinates only. These modes enable the destruction of long-range hidden targets with pinpoint precision, damage assessment, and by obtaining of real-time intelligence.
With non-line-of-sight capabilities, Spike has a range of up to 32 km. and can be fired from vehicles, helicopters, ships and ground launchers. The ATGM has advanced electro-optic seekers which include the capabilities of a smart target tracker with artificial intelligence features, increasing its lethality.
Designed to be used against new modern targets with a low signature and time-sensitive characteristics, the Spike ATGM can be fired at grid target coordinates, including advanced armor and protection systems, making it one of the only missiles in the world with this capability.
And while close to 10,000 Russian troops are reported to have been killed in the monthlong war in Ukraine, and dozens of tanks, trucks, armored vehicles, artillery pieces, drones and other hardware were destroyed, Russia’s military is still one of the largest in the world.
According to Global Firepower, which analyzes the military capabilities of countries around the world, Russia has one of the most powerful militaries in the world and spent $61.7b. on its military in 2020.
SOURCES EXPLAINED to the Post that while the tense geopolitical situation in Europe is a major reason behind the expected purchasing spree, countries around the world have been modernizing their forces to face new threats such as drones.
Drones, such as the Turkish-manufactured Bayraktar combat drones, have been playing a key role in Ukraine, taking out countless Russian platforms. Drones also played a central role in the 2020 conflict between Armenia and Azerbaijan in the Nagorno-Karabakh enclave.
Harop drones, a munition that acts like a drone but is also a warhead that slams into a target like a missile, as well as Orbiter loitering suicide drones capable of carrying an explosive payload, were used in the conflict.
Germany, which increased its defense budget to 2% of the GDP and said it would set up a special €100b. fund to swiftly upgrade its armed forces, has announced it would purchase Israel’s Heron drone.
While Berlin already has five Herons, they are not armed and are used mainly for assisting in combat situations as well as accompanying convoys and patrols, reconnaissance and surveillance, establishing movement profiles and long-term monitoring of threat actors, protecting military assets and camps as well as supporting humanitarian missions.
The Heron TPs are IAI’s most advanced UAVs, with a 40h endurance, maximum takeoff weight of 5,300 kg. and a payload of 1,000 kg. They can be used for reconnaissance as well as combat and support roles and can carry air-to-ground missiles to take out hostile targets.
In addition to drones, European countries will also likely look at Israeli-made air defense systems to integrate into their militaries to fend off drones or missiles.
According to Rubin, while European countries can buy air defense systems manufactured by Israel, the Jewish state will not sell the Iron Dome to any European nation, because of an agreement signed with the United States.
“The SPYDER is a good air defense system, and Finland already made an agreement to buy another air defense system, but we have laws and regulations in regards to defense exports, and international obligations to control our defense export market,” he said.
But “the Iron Dome is not an item that can be freely sold. It is in a special category because of our obligations to the United States and its sensitivity. It is in a different class in regards to permits and exports.”
While Israel is unlikely to sell the Iron Dome system to countries that may face the might of the Russian military, the David’s Sling and SPYDER air defense systems might be provided to NATO nations.
The SPYDER mobile system, already purchased by several countries, incorporates Rafael’s advanced Python-5 and I-Derby missiles to provide short-, medium- and long-range protection against a range of threats, including attack aircraft, cruise missiles, unmanned aerial vehicles and standoff weapons.
The system, which uses electro-optical observation payload and wireless data link communication, can engage multiple threats simultaneously up to 80 km. away in all weather conditions.
While European countries have yet to purchase the SPYDER, sources believe that it is a system that will be seriously looked at by several militaries that need a NATO-compatible system.
Finland is also considering purchasing Rafael’s David Sling and the Barak-8 MR-SAM systems, in order to defend its skies. While sources denied that the interest in the Israeli systems is due to the war in Ukraine, Russia has threatened the Nordic country with “serious” ramifications should it apply to join NATO.
The David’s Sling, also known as Magic Wand, is designed to intercept tactical ballistic missiles, medium- to long-range rockets, as well as cruise missiles fired at ranges between 40 km. and 300 km.
David’s Sling is a joint Israeli-US project, with Rafael collaborating with American defense contractor Raytheon (which also produces the Patriot missile system). Elta – an IAI subdivision – developed the system’s radar, and Elisra, a subdivision of Elbit Systems, developed the command and control mechanisms.
The Barak-8 MR-SAM system is able to shoot down enemy aircraft at a range of 50-70 km., and the system is designed to defend naval vessels against a myriad of short- to long-range airborne threats such as incoming missiles, planes, and drones at low or high altitudes.
The system integrates several advanced state-of-the-art systems, including a digital radar, a command and control system, tracking radar launchers, interceptors with advanced homing radio frequency seekers, data link, and system-wide connectivity. It is also able to engage multiple targets simultaneously in severe saturation scenarios and can be operated in all types of weather.
But the deals that Israeli defense companies are expecting to see due to the war will not bring in the millions of dollars right away. Deals are not made from one day to the next. They can take several years before they are signed.
Nevertheless, Israeli defense companies are getting ready for a surge in demand for their products