Israel Aerospace Industries moving production to Mississippi

By Ora Coren, Ha'aretz

The Israel Aerospace Industries is moving certain production lines from Israel to the United States. The production lines are being moved to group company Stark Aerospace, located in Starkville, Mississippi.

Stark is technically a subsidiary of IAI International, which is the main U.S. subsidiary of the Israeli firm.

Yesterday IAI cut the ribbon, as it were, on its new Stark plant to manufacture and assemble drones (small pilotless planes). Stark will also be making the electronic and electro-optic systems used by the drones. IAI commented, however, that none of the workers engaged in building drones in Israel will be fired. They will simply build drones for other countries. Brazil placed a roughly $300 million order just last week.

One reason for the move is that many Western countries, and this includes the U.S. prefer to buy armaments and other defense gear from local companies. Therefore, to increase sales outside Israel, Israel's defense companies have to set up subsidiaries in target markets, rather than expand local manufacturing.

IAI set up Stark in 2006 to drum up business in America. The following year inaugurated its first production outfit, which makes Hunter unmanned vehicles that it sells through Northrop Grumman. In fact, the U.S. armed forces have been using Hunter drones since the early 1990s.

Altogether IAI is investing about $25 million in the Stark production facilities, where it has built laboratories, manufacturing and systems integration units and production lines.

Stark has another plant in Columbus, Ohio that provides manufacturing, assembly and maintenance services for electro-optic plug-in optronic payload (POP) made by IAI for Shadow drones.

IAI chairman Yair Shamir said yesterday that the company understands the importance of working closely with its clients, to make sure that the solutions meet the needs.

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