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Israel’s big four arms cos had $7.2b export sales in 2010

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Tuesday, June 28th, 2011

As repprted in Globes:

The Defense Industries Report for 2010 released today by Hemda Mark, economic advisor to the Ministry of Defense, reveals that sales by Israeli defense companies in 2010 totaled $9.6 billion, 3% more than in 2009. Most of the sales are accounted for by Israel’s four biggest defense companies, Israel Aerospace Industries (IAI), Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT), Rafael, and Israel Military Industries (IMI). Their aggregate sales were $8.2 billion. In 2010, these companies had an aggregate orders backlog of $18.8 billion, 9% more than in 2009. The report, issued by Mark ahead of the Paris Air Show, also shows that export sales by Israeli companies in 2010 totaled $7.2 billion.

According to the report, Israel’s defense industry directly employs some 43 thousand people, with average sales per employee reaching NIS 233,000 in 2010. Thanks to the activity of these companies, another 140 thousand people are employed, giving a total output estimated at $25 billion.

IAI has the largest orders backlog, amounting to $8.9 billion in 2010. Second to it, by a long way, is Elbit Systems, with a backlog of $5.4 billion, followed by Rafael, with $3.5 billion, and IMI, which has a backlog of $1 billion, after improving its performance slightly in comparison with 2009.

The smaller companies had total sales of $1.4 billion in 2010. 90% of their output was for export. The leading company in this group is Plasan of Kibbutz Sassa in Northern Israel, which makes armor components for combat vehicles, and which had sales of $780 million last year. It is followed by UAV company Aeronautics of Yavne, with sales of $160 million, IWI, which makes rifles and sub-machine guns, and had sales of $120 million, and jet engine component maker Bet Shemesh Engines, with sales of $51.6 million.

According to the report, the global arms industry was worth $400 billion in 2010. Israeli companies had 7.1% of this market. One of the main segments of the industry in which Israel leads is UAVs, while in newer areas such as active armor and anti-missile systems like the Arrow and Iron Dome, Israel enjoys a lead that could enable it to penetrate new markets.

Published by Globes [online], Israel business news – www.globes-online.com – on June 15, 2011