Every war exacts a high price of the economy, and the war with Iran is no different. But, whether or not the regime of the Ayatollahs survives, the war was proof positive of the quality of Israel’s defense industry, against a country backed by Russia and China.
In the initial Israeli strike, advanced remote-controlled anti-tank missiles were reportedly used to neutralize some of Iran’s ballistic missiles. In addition, UAVs were deployed for targeted killings. UAVs and drones dominated Iranian skies, and many Israel-produced munitions were hurled down. The whole complex event was coordinated with very advanced communications.
The outstanding company meeting the communications challenge was Orbit Communication Systems (TASE: ORBI), which has seen its share price rise by about 25% so far this year and by about 550% in the past five years. The company develops and produces communication systems, mainly satellite systems, and the defense sector accounts for 81% of its sales. In Israel, these systems are installed in the air, at sea, and on the ground, and in the Swords of Iron war they have proved themselves in every arena.
"The communications environment in the conflict with Iran is tough; it’s not Hezbollah and it’s not Hamas," says Orbit CEO Daniel Eshchar. "Iran has many technological capabilities, integrated with Chinese and Russian technologies. These two powers support it, and so Iran has super-power capabilities in this area."
The war with Iran, Eshchar says, has boosted international interest in the Israeli systems, because they not only proved themselves in the war, but they are mature, with battlefield experience behind their use.
Stars in the Teheran sky
Despite the challenges of the Swords of Iron war, the State of Israel managed to reach a new record for defense exports in 2024: $14.795 billion, representing an 11.7% increase over 2023, and a doubling within five years, according to figures from SIBAT, the International Defense Cooperation Directorate of the Israel Ministry of Defense.
One of the mainstays of Israel’s defense industry is Elbit Systems (TASE: ELST; Nasdaq: ELST). The company is active in UAVs, electronic warfare, and munitions. Its revenue grew 14.3% last year to $6.8 billion.
The Elbit Systems product that really took control of the skies of Iran, and particularly of Teheran, was the Hermes 900 (Star) UAV, which costs some $6.85 million per unit. It has an active range of 1,000 kilometers or more, is based on satellite communications, and flies at medium altitude, for long durations.
"The ‘Stars’ dominate the skies of Iran, and hunt. Advanced intelligence capabilities have been demonstrated in Iran, only some of which have been reported," says Ran Kril, EVP of International Marketing and Business Development at Elbit Systems. "In video of the IDF spokesperson, you can see a hunt 1,500 kilometers away from Israel. We didn’t need that incident, but it’s exposure and advertising. One of our most important assets in electronic warfare systems for self-defense is installed on every Israel Air Force aircraft, and enables it to operate freely in places full of threats. These are extreme capabilities with which the world needs to be equipped. I assume that NATO will increase defense spending and will look at Russia and China to compare systems - those of Elbit will be there, because they represent state of the art technology."
Kril explains that an important difference between Swords of Iron and Rising Lion lay in the fact that advanced systems were deployed in Iran. For example, the website Army Recognition reports that the Israel Air Force used 227 kilogram MPR500 bombs, carried by F-15 and F-16 aircraft, to penetrate bunkers built with reinforced concrete up to a meter thick.
"There are more capabilities that will be revealed later on, and some that will not be revealed," says Kril, who also puts the spotlight on the lessons that need to be learned from the costs of interception. Every Arrow 3 interceptor costs $2 million. An Iron Dome interceptor is estimated at $30,000. A broader laser solution than Iron Beam could, he says, provide an answer at negligible cost. "How much that would save us in munitions, including against UAV swarms," he says.
Collaboration enquiries
Besides Elbit Systems and other large companies such as Israel Aerospace Industries, a lively UAV industry is flourishing, producing aircraft of various sizes and types, with various purposes. A unique Israel company is Steadicopter, which specializes in unmanned helicopters, as opposed to the many companies that deal in fixed-wing or VTOL aircraft.
Steadicopter CEO Itai Toren says that overseas customers have been following events since the start of the Swords of Iron war with great interest, and of course what has been happening in Iran. "The reactions we hear are astonishment at how effective Israel weaponry is on the battlefield. We can’t talk about what, where, and how we’re involved, but customers understand, and look very favorably on the Israeli UAV industry."
Toren says that most of the interest in the company arises from armed systems. "There have been many approaches recently from foreign companies wanting to examine the possibility of collaboration, of local production and joint development."
A life-saving armored vehicle
The Iran campaign diverted attention from the war in the Gaza Strip, which continues. Plasan, from Kibbutz Sasa, 3.5 kilometers from the Lebanese border, designs and produces armored vehicles. Its products are in service in the Gaza Strip, but also in countless other places.
The company is seen as a center of know-how on an international level, and among the companies that collaborate with it is General Dynamics in Europe and Canada, Korean company Hanwha in Australia, and Oshkosh. The company also produces armor for NATO frigates, helicopters, and transporter planes.
Plasan VP Marketing and Business Development Gilad Ariav says that on October 8 2023, the IDF came along and took all the vehicles that the company had in stock. Since then, customers have expressed interest in the company’s lessons from the war. "Our armored vehicles save lives. To receive one of our Tigris vehicles with the entire rear end blown apart and without a rear axle, but to know that the soldiers who were inside are alive and came away almost unharmed, is a source of pride. It shows that we’re doing something right."
An intriguing product of the company is the ATeMM (All-Terrain Electric Mission Module), an electric platform mounted on a vehicle and enhancing its power and payload. It can also function as a robot. The IDF uses it, and customers around the world are examining it. "It wasn’t always that way, and we’re very proud," says Ariav.
Published by Globes, Israel business news - en.globes.co.il - on June 25, 2025.
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