Israel Secures Additional Arrow 3 Air Defense Missile Systems Order From Germany worth $3.1 Billion

Israeli Ministry of Defense announced that Israel and Germany have signed a new defense contract worth approximately $3.1 billion to expand Germany’s deployment of the Arrow-3 exo-atmospheric air and missile defense system. The agreement strengthens one of Europe’s most significant missile defense partnerships as Berlin accelerates efforts to counter long-range ballistic missile threats.

The deal underscores deepening bilateral defense cooperation at a time of heightened security concerns across Europe and reflects Germany’s growing emphasis on layered air and missile defense as a cornerstone of national and allied deterrence.

Building on the 2023 Arrow-3 Agreement

Israeli defense officials said the newly signed contract builds on the initial Arrow-3 agreement signed in November 2023, which marked the first export sale of the advanced interceptor. Valued at around $4 billion and approved by the United States government, that agreement became the largest defense export deal in Israel’s history and signaled a fundamental shift in German defense planning toward long-range ballistic missile interception.

The 2023 agreement covered procurement, system integration, and initial deployment of Arrow-3 for German service and laid the foundation for Germany’s participation in the European Sky Shield Initiative, with deliveries scheduled to begin in 2025.

First Operational Delivery in December 2025

A major milestone was reached on December 3, 2025, when Israel delivered the first operational Arrow-3 system to Germany during a formal ceremony at a German Air Force base near Berlin. The Israeli Ministry of Defense described the handover as a decisive step in implementing the export contract signed nearly two years earlier.

The delivery included core system elements intended to support early integration into Germany’s national air defense architecture and to prepare the system for phased operational deployment.

Scope of the $3.1 Billion Expansion Contract

According to Israeli officials, the $3.1 billion expansion deal significantly broadens the scope of the original agreement. It covers additional system components, an expanded interceptor inventory, extended coverage, and long-term sustainment and logistical support. The objective is to allow Germany to field Arrow-3 at scale, ensuring interceptor availability, enhanced command-and-control integration, and sustained operational readiness over the coming decades.

Defense sources said the follow-on contract is critical for transforming Arrow-3 from an initial capability into a fully mature strategic layer of Germany’s missile defense posture.

Arrow-3 Technical Capabilities

Arrow-3 represents the uppermost layer of Israel’s multi-tier missile defense architecture and is designed to intercept long-range ballistic missiles outside the Earth’s atmosphere. Using hit-to-kill technology, the interceptor destroys incoming threats through direct kinetic impact, eliminating the need for an explosive warhead.

By engaging targets during the midcourse phase of flight, Arrow-3 neutralizes missiles before atmospheric reentry, significantly reducing the risk of debris or warhead detonation over defended areas.

The system is developed by Israel Aerospace Industries through its MLM Division, in close cooperation with the U.S. Missile Defense Agency. It integrates EL/M-2080 Green Pine long-range radar, advanced battle management and command-and-control systems, and an interceptor equipped with a high-resolution infrared seeker, autonomous guidance, and extreme maneuverability, enabling engagements at altitudes exceeding 100 kilometers.

Germany’s Strategic Rationale

The expansion of Arrow-3 is closely linked to Germany’s reassessment of defense priorities following Russia’s war in Ukraine. The widespread use of ballistic missiles, cruise missiles, and long-range precision strike systems during the conflict exposed vulnerabilities in European air defense coverage.

In response, Berlin has accelerated investment in a layered air and missile defense architecture, including Patriot PAC-3 and IRIS-T SLM, while adding exo-atmospheric interception as a new strategic layer. Integrated under the European Sky Shield Initiative, Arrow-3 is intended to protect German territory while contributing to broader NATO missile defense coverage.

Industrial and Strategic Impact

Beyond operational benefits, the follow-on contract deepens defense-industrial cooperation between Israel and Germany. The program is expected to involve German industry in infrastructure development, system integration, training, and lifecycle support, while strengthening Israel Aerospace Industries’ long-term production pipeline. Continued trilateral coordination with the United States remains essential due to Arrow-3’s joint development framework.

A Pillar of Europe’s Future Missile Defense

Together, the December 2025 operational delivery and the $3.1 billion expansion contract underscore Europe’s growing emphasis on deterrence by denial. By moving from contract signature to deployment and large-scale expansion, Germany is positioning itself as a central pillar of Europe’s future air and missile defense architecture, with Arrow-3 serving as a critical shield against emerging long-range missile threats.