Germany signs €2 billion deal for Israeli Spike missiles despite arms embargo
Rafael’s partnership with German firms allows the deal to bypass political constraints as Europe rethinks ties with Israel.
Israeli defense contractor Rafael Advanced Defense Systems will supply the German army with Spike anti-tank missiles in a deal worth approximately €2 billion, one of the largest agreements signed by Israeli defense industries in Europe in recent years. The contract is especially notable given the arms embargo imposed on Israel earlier this year by German Chancellor Friedrich Merz, following the Israeli cabinet’s controversial decision to extend the war in Gaza.
The deal will be executed through EuroSpike GmbH, a joint venture owned by Rafael (20%) and German defense firms Rheinmetall (40%) and Diehl Defense (40%), which markets the Spike missile family across Europe. Production will take place at Eurospike’s facilities in Germany.
The Spike missile is Rafael’s best-selling weapon system globally, known for its operational simplicity and compatibility with a wide range of launch platforms. To date, Rafael has sold Spike missiles to more than 40 countries, about half of which are NATO members.
In contrast to Germany’s approval, other European countries have moved in the opposite direction. Citing the humanitarian crisis in Gaza, Spain recently canceled a planned purchase of 1,700 Spike missiles and 170 launchers from Rafael, valued at roughly ₪1 billion (about €250 million).
Industry sources suggest that the European ownership structure of EuroSpike helped make the German deal possible, allowing Berlin to move forward despite the diplomatic fallout surrounding Israel.
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Germany remains Israel’s second-largest defense partner after the United States and a longstanding customer of its military industries. Just before the October 7 war, Israel Aerospace Industries (IAI) finalized the €3.3 billion Arrow 3 missile defense deal with Germany, the largest defense export contract in Israel’s history. IAI is expected to deliver the first Arrow 3 interceptors by the end of this year, and Berlin is reportedly considering a future purchase of the Arrow 4, which is still under development.
While Germany has previously acquired Rafael’s Spike missiles, this new agreement through EuroSpike represents its largest procurement of the system to date. Rafael declined to comment on the deal.
Meanwhile, Israel Aerospace Industries, Rafael’s domestic rival, is intensifying competition in the anti-tank missile market. The company has unveiled a new version of its long-running Lahat missile, originally developed over three decades ago. The upgraded model, dubbed “Lahat Alpha,” can reportedly strike targets at ranges of more than 20 kilometers, twice the reach of earlier versions.
According to IAI, the missile is guided by laser rather than GPS, enabling accurate engagement even in environments where electronic jamming is prevalent. The new system is designed to offer long-range precision without requiring a direct line of sight between the operator and the target.
