Israel’s Ministry of Defense has announced that Germany’s Bundestag has approved the expansion of its Arrow 3 deal with Israel Aerospace Industries (IAI) by an additional $3.1 billion. The latest Arrow 3 deal, signed by the Israeli and German defense ministries, will bring the total amount Germany is spending on the long-range missile defense system to more than $6.7 billion – easily the biggest defense deal in Israel’s history.
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The Arrow 3 system was jointly developed by the Ministry of Defense Directorate for R&D (DDRD) (MAFAT), the US Missile Defense Agency and IAI, which is the prime contractor for the development and production of the system.
As part of the expansion of the deal, the Israeli and German Defense Ministries agreed to significantly increase the production rate of Arrow 3 launchers and missiles, which will be supplied to Germany and significantly improve its air defense capability.
Two weeks ago the first Arrow 3 system supplied by Israel to Germany became operational. The system has proven itself in Israel’s defense over the past few years, intercepting missiles launched from Iran and Yemen.
Published by Globes, Israel business news – en.globes.co.il – on December 17, 2025.
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