Boeing, Raytheon Assured Half of Surging US Support for Israel Missile Defense

August 12, 2016

Defense News:

As US missile defense funding to Israel surges, so, too, does the economic benefit to American teams led by Boeing and Raytheon, partners with Israel on joint production of the systems designed to defend against rapidly expanding threats.

Under annually renewable addenda to existing government-to-government agreements, 50 percent of US production funding reverts back to the two American subcontractors and their respective rosters of US-based suppliers, officials and industry executives from both countries said.

In this year’s budget approved by House and Senate appropriators, that will translate into nearly $100 million for Boeing, partners with Israel Aerospace Industries (IAI) on the Arrow-2 and upper-tier Arrow-3 programs against the heaviest and most advanced Shihab-class ballistic missiles from Iran.

It also means that Raytheon Co., partners with Rafael Ltd. on the war-proven Iron Dome and the soon-to-be-operational David’s Sling, stands to gain a similar amount for production work on the two other distinct layers of Israel’s multi-layered intercepting network.

According to congressional documents for fiscal year 2017, House and Senate appropriators approved $62 million for Iron Dome and $266.5 million for David’s Sling, which includes $150 million in production funding. Raytheon and its team of US suppliers are expected to receive half of production funding appropriated for the two programs.

“Under our agreements with the US, we are committed to true joint production whereby 50 percent of the budget and approximately 50 percent of the work will be done by US companies in America,” said Israel Navy Capt. S., head of Upper-Tier Programs at the Defense Ministry’s Israel Missile Defense Organization (IMDO).

His full name was withheld from publication for security reasons, in accordance with restrictions set by the Israeli government.

In an Aug. 4 interview, the IMDO official said the sheer volume and growing precision of the missile and rocket threat to Israel demands “continuous and intensive efforts” to improve on existing capabilities.

“We are very grateful for the consistent support received from the US government. We’re very happy with the cooperation we enjoy with MDA [the Pentagon’s Missile Defense Agency]. …  It’s essential for us, but also very important to the US economy,” the official said.

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