Israel Aerospace Industries

industry	Aviation, defense

products	Military weapons and equipment

services	Aircraft maintenance Aircraft upgrade

revenue	▲ US$4.973 billion

revenue year	2022

operating income	▲ US$797 million

income year	2022

net income	▲ US$213 million

net income year	2022

num employees	15,000

divisions	Bedek Aviation Group Commercial Aircraft Group Military Aircraft Group Systems, Missiles & Space Group

subsid	ELTA Systems

homepage	https://www.iai.co.il/

Israel Aerospace Industries (IAI; ) is Israel's major aerospace and aviation manufacturer, producing aerial and astronautic systems for both military and civilian usage. It has 14,000 employees as of 2021. IAI is state-owned by the government of Israel.

IAI designs, develops, produces and maintains civil aircraft, UAVs, fighter aircraft, missile, avionics, and space-based systems.

IAI's main focus is engineering, aviation and high-tech electronics, though it also manufactures military systems for ground and naval forces. Many of these products are centered on the core needs of the Israel Defense Forces (IDF). Other offerings are marketed to numerous foreign militaries.

History

Israel Aerospace Industries was founded in 1953 as Bedek Aviation Company under the initiative of Shimon Peres, then director general of the Ministry of Defense, in order to maintain Israel Defense Forces aircraft.[1] The company originally had 70 employees and recruited American born aviation expert Al Schwimmer as the company's founder and first president.[2]

First aircraft manufacturing

In 1959 Bedek began manufacturing its first aircraft, a V-tailed twinjet trainer of French design, the Fouga CM.170 Magister, locally called Tzukit (monticola). The Tzukit became the Israeli Air Force principal trainer for 50 years. The IAI Tzukit was also used in the 1967 Six-Day War by 147 Squadron as a close support aircraft, attacking targets on the Egyptian front during the first day of the war, when Israel's more capable combat aircraft were deployed against Arab air bases and aircraft.[3] They were then deployed against Jordanian forces, including armour, on the West Bank. The Magister proved effective at the close-support mission albeit with heavy casualties, with six being lost.[4]

The first aircraft to be fully designed and built by IAI, the IAI Arava short take-off and landing transport aircraft, first flew in 1969 after three years of development.[5]

The French embargo impact

Products

Civilian aircraft produced

Source:[24]

IAI Westwind (1965–1987) :
1121 Jet Commander, Certification : November 1964, Line relocated in Israël in 1969
1123 Commodore Jet, Certification : December 1971, stretched, GE‐CJ610‐9 turbojets, thrust reversers, wing-tip tanks, APU
1124 Westwind I, Certification : March 1976, TFE731‐3 turbofans, updated systems and avionics
1124A Westwind II, Certification : April 1980, winglets, wing refinements, additional tank, upgraded avionics
Gulfstream G100 (1985–2016)
1125 Astra, Certification : August 1985, new wing, modified fuselage, updated systems and avionics
1125 Astra SP, Certification : May 1990, digital avionics

Manufacturing plants

Systems, Missiles & Space Group
Malam – integration
Mabat – missiles and satellites
Tamam – inertial guidance and electro-optic systems
Military Aircraft Group
Lahav – aircraft upgrades
Mata – helicopter upgrades
Golan Industries – crash survival seats and other aircraft parts
Malat – Unmanned Aerial Vehicles
Elta – Radars, electronic warfare and ELINT
Bedek Aviation Group – MRO
Aircraft Division – Conversion of passenger aircraft to cargo aircraft, heavy aircraft maintenance, Fleet Maintenance
Engines Division – Repair and overhaul of civil and military aircraft engines (P&W

2026 Partial Privatisation and IPO

For over two decades, the Israeli government debated the structural transformation of its defense sector, a discussion that culminated in January 2026 with a formal commitment to partially privatize Israel Aerospace Industries through an initial public offering (IPO) on the Tel Aviv Stock Exchange[36]. This transition represents a landmark shift for the formerly state-owned enterprise. The move is designed to streamline corporate decision-making by reducing government bureaucracy while simultaneously securing the capital necessary to maintain technological parity in a competitive global market.[37]

Timeline

The momentum for this shift grew significantly in late 2025 after a ministerial panel, chaired by Accountant General Yali Rothenberg, approved a strategic framework allowing for the sale of up to 49% of the company’s share capital.[38]

By January 12, 2026, senior officials confirmed that the primary regulatory hurdles and complex labor union negotiations, which had historically stalled previous privatization attempts, were nearing resolution.

Bibliography

Aloni, Shlomo. "Trainers in Combat: Valour and Sacrifice in the Six Day War". Air Enthusiast, No. 94, July/August 2001. pp. 42–55. ISSN 0143-5450

External links

Israel Aerospace Industries – official site.
IAI Space Systems
IAI Space Division
Official org-chart (2 January 2007)

References

Shimon Peres – Profile, Defense News^
Al Schwimmer, founder of Israel Aircraft Industries, dies at 94 Haaretz, 11.06.11^
Aloni 2001, p.44.^

1990s onwards—export led growth

By 1989 IAI posted a profit of $11.8 million on sales of $1.28 billion. The company had four divisions—Aircraft, Aviation, Electronics, and Technologies—and 17 factories. IAI was established as a world leader in upgrading aircraft. Planes such as the Vietnam-era McDonnell Douglas F-4 Phantom II were modernized with advanced avionics and weaponry.

In the 1990s IAI entered the space race with the AMOS communications satellites, Ofeq observation satellites and the Shavit space launcher.[11]

In December 1997, the IAI Galaxy, a business jet with an intercontinental range developed as a joint venture Galaxy Aerospace with the Hyatt Corporation, made its first flight and entered service in 2000. In May 2001, General Dynamics' Gulfstream Aerospace bought IAI's Galaxy Aerospace Co. L.P. unit for $330 million, although IAI continues to perform most of the assembly and development of the jets which are marketed by Gulfstream.[13]

In 2003, Israel Aircraft Industries attempted to enter the VLJ (very light jet) Market by launching the Avocet ProJet, a 6–8 seat high utilization air taxi with a list price almost half the cost of the least expensive business jet available at that time. In early 2006, ProJet development stalled after a major undisclosed US OEM pulled out of the program due to unspecified reasons.[14]

The company was working with the Aviation Technology Group on a military trainer version of the ATG Javelin, a fighter style personal jet. The version being developed would have competed against a large field of jet trainers at a much lower cost of acquisition and maintenance. ATG halted development of the Javelin in 2008 due to a lack of funds.

In March 2004 IAI signed a $1.1 billion contract with India to install three EL/W-2090 AWACS systems on Russian-made Ilyushin Il-76 transports, which are based in part on IAI's earlier EL/M-2075 Phalcon platform which was developed in the 1990s.[15] In the late 2000s IAI developed the follow-on EL/W-2085 system which is installed on heavily modified Gulfstream G550 aircraft and which besides serving in the IAF were also sold to Singapore and Italy.

On 6 November 2006, IAI changed its corporate name from "Israel Aircraft Industries Ltd." to "Israel Aerospace Industries Ltd."; to more accurately reflect the current scope of the firm's business activities, which includes not just aircraft, but also systems, satellites and launchers, as well as maritime and ground systems.

On 13 April 2009, the Moscow Times reported that the Russian Defense Ministry had signed an agreement with Israel Aerospace to purchase $50 million in pilotless drone aircraft. The contract reportedly includes three types of UAVs manufactured by the company.[16]

In January 2012, IAI announced a sale of $1.1 billion of defense systems to an Asian country. The deal has been signed but the company did not name the buyer. It was reported that the sale will include IAI aircraft, missiles and intelligence technologies.[17]

On 4 September 2012, the Gulfstream G280, a new twin-engine business jet built by IAI, received full certification from the Federal Aviation Administration (FAA).[18]

IAI is a member of the prestigious Trace International and Society of Corporate Compliance and Ethics (SCCE) organizations and recognized in the Transparency International April 2015 report to be in the top third of worldwide defense companies for its ethics and anti-corruption programs.[19]

In April 2018, IAI systems were observed in a film made by the Azerbaijan Army, specifically the IAI Harop loitering munition system, resulting in criticism from the Armenian government concerning the supply of Israeli arms to the Azeri army.[20] In 2019, IAI sells drone defense systems to governments to be placed in sensitive areas such as borders, army bases, or power plans, and provides equipment to shoot down military drones as well. It also sells to clients such as airports looking to protect against consumer drones. IAI in 2019 is Israel's major aerospace and defense manufacturer. It released its Popstar system in September 2019, which "can detect and track drones up to 4 km away in day or night".[21] IAI advised customers in December 2019 not to fly some Boeing 737 freighters it had converted, after IAI said it detected an "apparent irregularity" in the production process. IAI's converted 737s had come into service in 2003.[22]

In July 2021, IAI Aviation Group has agreed to establish a passenger to freighter conversion site to convert the B737-700/800 with Atitech (Italy) in Naples.[23]

key people
type	State-owned enterprise
traded as	tase: ARSP.B1
predecessor	Bedek Aviation Company
foundation	1953
founder	Al Schwimmer Shimon Peres
location city	Lod
location country	Israel

Israel Aerospace Industries

History

First aircraft manufacturing

The French embargo impact

Products

Civilian aircraft produced

Manufacturing plants

2026 Partial Privatisation and IPO

Timeline

See also

Bibliography

External links

References

Diversification

Developing the maintenance, repair and overhaul business

Developing the maintenance, repair and overhaul business

The Lavi program

1990s onwards—export led growth

Civilian air systems

Military aircraft

Unmanned aerial vehicles

Military air systems

Ground defense systems

Ground transportation

Creation underway

Creation underway

Unmanned ground vehicles

Naval systems

Missile systems

Space hardware