The opening strike of Operation Rising Lion looked like something out of a Hollywood action blockbuster: hundreds of planes and unmanned aerial vehicles (UAV) fly 1,600 kilometers to fatally damage Iran’s ballistic missile systems, nuclear program, and high command. At the same time, Mossad agents on the ground set up a loitering munitions base near Iranian missile launchers, and prevent an immediate launch aimed at Israel.
Since then, Israeli unmanned aerial vehicles have become a fixture of Iran's skies. Loitering munitions (suicide drones) have accurately hit the regime’s strategic assets and attack drones have joined in the massive bombing of fighter jets, from Mashhad in the east to Kermanshah in the west. In addition, there are camera-equipped data collection drones for reviewing attack site results, drones for locating targets, and even drones that assist in preventing ballistic missile launches into Israel.
These weapons are, of course, nothing new. Behind them are years of work. The National Program for Economic Growth (a joint program of the Ministry of Economy and Industry and JDC-Tevet) identified the defense industry in general, and drones in particular, as a significant potential engine of success for Israel, and established the Defense & Cyber Cluster (managed by Elinor Yakobson). According to National Program for Economic Growth data, there are about 275 companies operating in this sector in Israel, of which 241 are in the program’s database. 35% of these are early-stage, 18% are growth companies, 10% are public companies, and 29% are mature companies. About $4.69 billion is invested in these companies overall.
Meanwhile, between the outbreak of the October 7, 2023 Swords of Iron war and December 31, 2024, the Israeli government and the Ministry of Defense allocated about NIS 782 million ($219 million) to dozens of startups in the drones and anti-drone technology sector. According to a report by the Washington-based Center for a New American Security (CNAS), Israel’s exports of in drone-related products are worth some $500 million each year, with expected growth of 5-10% next year.
World leaders want to learn more
How did Israel become a UAV and drone power, and what effects will this have in the future?
Col. (res.) Yiftach Kleinman has more than 25 years’ experience in the defense industries. For many years, he worked at Rafael Advanced Defense Systems as Director of Marketing and International Business Development until being named Deputy General Manager of the Land Warfare and Naval Warfare divisions and became one of the figures identified with the Trophy (Windbreaker) active protection system (APS) for armored vehicles. He currently serves as the CEO of loitering munitions company SpearUAV, which was founded in 2017. Kleinman views the success of the attack on Iran as an application of a technological advantage over it. In general, when the implementation phase is reached, senior officials around the world want to learn from Israel about how they can achieve the level of high-quality synchronization that distinguishes Israel’s security forces from those of other countries.
"The synchronization of the development of capabilities over the years, led by the Ministry’s Directorate of Defense Research & Development (DDR&D/MAFAT), and the various organizations and companies, are what created this supremacy," says Kleinman. "It’s been exemplified for almost two years throughout the entire Middle East and is now demonstrating tremendous capabilities. The operational experience and implementation here is the best of its kind."
Kleinman also notes that the current period is unique. "What technology is doing today is making capabilities that were once the sole domain of the Air Force available to an individual soldier. With our apparatus, for example, a soldier undergoes four days of training and then can use loitering munitions for intelligence gathering and attack missions. By contrast, until a few years ago, a TOW ("Orev") missile operator needed to take a three-month course.
"Along with shortening timeframes, loitering munitions significantly increase the operational effectiveness of each soldier. It is possible to save on personnel, endanger fewer soldiers, and make every soldier far more lethal - and that’s revolutionary."
Shai Fishbein, VP of Business Development and Marketing at SCD, a subsidiary jointly owned by Rafael and Elbit that deals in infrared detectors and laser diodes for surveillance, homing, and weapons sights, explains how he perceives Israel's advantage in the field. "Israeli customers demand breakthroughs that take us to the edge, and that pulls us even higher," says Fishbein, referring to the Israeli companies that account for 40% of SCD’s sales, as the only company on the market with detectors of up to four megapixels. "This happened thanks to years of experience and high operational capabilities. Israel is a global leader in the platforms themselves and we work with companies like Elbit, Rafael, and Israel Aerospace Industries (IAI). We make possible observation and intelligence capabilities in any weather, at all hours. "
There is something else that makes developing drone technology relatively easy: the price. Dr. Yehoshua Kalisky, a senior researcher at the Institute for National Security Studies (INSS), and an expert in laser, electro-optics and sensor technologies, notes that an F-35 aircraft, for example, costs about $80 million, while the cost of a drone is in the hundreds of thousands. "Drones are relatively small, made of lightweight materials, painted in radiation-absorbent colors; together these characteristics create a low radar cross-section. In addition, their maneuverability is better than manned aircraft, and they can be operated in swarms. Because there’s no pilot, they can be operated 24/7."
Stars and trails in the sky
As with all aspects of the war, Israel's defense establishment would have found it difficult to implement its range of capabilities without the defense companies. Each of the large Israeli companies has one product or a series of products that can be applied to UAVs. For example, Elbit Systems, now outstanding on the Tel Aviv Stock Exchange thanks to the success of its products in Iran, offers the Hermes series. It includes, among other things, the Hermes 900 Kochav ("Star)" - a satellite communications-based UAV with an estimated price of about $6.85 million per unit and an operating range of about 1,000 kilometers and more. The Hermes 900 belongs to the MALE (Medium Altitude Long Endurance) category. This UAV, which has been deployed in more than 10 countries, from Thailand in the east to Canada in the west, can operate for about 36 hours and carry up to four missiles.
Another UAV spotted in the skies over Tabriz, according to Iranian social media footage, is Israel Aerospace Industries' "Shoval" Maritime Heron. Like the Hermes, it is designed for long-range and medium-altitude missions, with a duration of up to 45 hours in the air. This UAV, which is used by more than 20 militaries around the world, can carry six types of payloads simultaneously, for data collection, surveillance, reconnaissance, and target acquisition missions.
Rafael offers the Spike Firefly ("Moaz") loitering munition, whose first operational use has been during the current war. It weighs three kilograms and has a range of up to 1.5 kilometers. According to "Defense Blog," it can carry a variety of warheads, weighing about 350 grams, for 15-30 minutes, depending on the number of battery packs.
Rafael subsidiary Aeronautics is another Israeli company that specializes in the MALE sector, offering tactical drones and loitering munitions with a low maximum takeoff weight of 25 kilograms.
However, looking at the bigger picture, Israel clearly cannot depend 100% on drones. In its campaign against the Houthis, between October 2023 and April of this year, the US lost 17 MQ-9 Reaper drones, worth about $35 million each. In other words, Washington lost drones worth a total of about $595 million in its Yemen campaign.
Alongside the large companies, a vibrant UAV industry is growing, as exemplified by SpearUAV. Only eight years old, the company started out in the submarine sector. Since then, the company has expanded its range, building on its expertise in armed systems production, from the lone fighter level to the battalion level. This makes SpearUAV unique, as most players in the world concentrate on loitering munitions and observation devices that serve division-level and above.
A force multiplier for Israeli companies
Looking ahead, the widespread, successful use of Israeli systems in general, and of UAVs in particular, is expected to have a significant impact on international demand. This became evident when defense exports peaked in 2024, despite the war, at $14.795 billion, an increase of about 11.7% compared with 2023, and double where they were five years earlier. Moreover, it puts a spoke in the wheels of those, like president of France Emmanuel Macron, who would try to boycott or stymie Israeli companies.
Macron has seen how, since the outbreak of the war, Israel's systems have proven themselves in comparison with France’s. In addition, last year he saw how IAI received, according to foreign reports, a $1 billion satellite deal with Morocco, pushing aside legacy French suppliers to Rabat, such as Airbus and Thales.
Fishbein explains that the success of Israeli defense companies at this critical juncture has two main effects. "On the direct level, these are systems that have proven themselves in operational activity. A customer sees a difference between a system on paper and one that’s been out into the field and has a track record, and not just a record, but also excellent results. This is a force multiplier for the Israeli UAV and drone companies."
Operational success also poses a challenge: fear of having capabilities exposed. The more intensive the attack and more varied the means, the greater the challenge. This was broadly demonstrated in the 2006 Second Lebanon War against Hezbollah: Israel used Spike-class anti-tank missiles for the first time, while in the Swords of Iron war, Hezbollah used Almas 1 missiles, produced by reverse engineering those same Israeli missiles.
In recent days, as part of its propaganda war, the Iranian regime has published media reports, for example, about a drone interception or Spike launchers it claims were left behind. Kleinman knows Spike well from his time at Rafael. "If they didn't want them to find something, they wouldn't find it. However, capabilities do get exposed, and that’s part of the price of war. Every time a game changer is introduced, abilities are revealed. Therefore, we must always make sure to be ahead of everyone else, and for this we need to develop technological abilities from childhood on and invest a great deal in our education system."
Published by Globes, Israel business news - en.globes.co.il - on June 23, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.