Israeli Companies Soaring Success at Paris Air Show

Companies score deals worth $800 million at the meeting-place of the world security elite

PARIS ? Elbit Systems' (Nasdaq: ESLT)  robot laboriously climbed the stairs in the company's display booth. Mission complete, it broadcast a real-time image of the Paris Air Show visitors staring at the robot.

Ladies and gentlemen, please meet Elbit's friendly robot for unfriendly places. It looks like a toy car and is supposed to replace soldiers in dangerous missions.

Its small dimensions allow a soldier to carry it on his back and to send it into a scary area using a remote control device. Images are broadcast in real time, allowing soldiers to quickly familiarize with enemy territory.

Two robots are already undergoing testing by the Israeli army, which enjoyed them so much it refused to return them for the exhibition.

The Paris Air Show is for the defense industry what Davos is for civilian industries. It is a meeting point to promote businesses and exchange professional ideas.

Israel, which ranks fifth globally in security-related exports, came here to secure its standing for the coming years. Achievements at the show are not measured in deals signed here but rather in strengthening ties and promoting sales.

"This is where the security experts of the world meet," said Yossi Ben Hanan, responsible for Defense Ministry exports. "They exchange ideas and arrange further meetings. I get more done here in a week than I do in two months at the ministry," he added.

"Everything is personal in this business," continued Ben Hanan. "You can't imagine how much being in this circle on a personal level determines decisions worth hundreds of millions of dollars. The defense trade relies on deep faith, political interests and secrecy."

Ben Hanan holds meetings non-stop every day at the show. He's not alone. Elbit Systems chair Mickey Federmann and CEO Joseph Ackerman also held a marathon of meetings.

"The energy invested in every business meeting is enormous because just outside awaits a competitor whom the client sitting with you will meet when he leaves you," said Ben Hanan.

The Defense Ministry delegation is located in a two-story office with a balcony overlooking several rows of the air show. Yesterday a commander in the Angolan air force visited the Israel Defense Ministry offices, according to Ben Hanan. "He passed by the exhibit and surely told himself that he could relax with us and more comfortably scan the area. At the same time, he also wanted to exchange ideas with us on several topics, and indeed we have operations in Angola."

Ben Hanan has met with several heads of leading companies over the past three days, from Boeing Integrated Defense Systems and Northrup Grumman to Pratt and Whitney and Lockheed Martin. He also met with security establishment heads from France, Spain, India and Romania.

"I sat with a man yesterday for whom buying a new fighter jet or satellite is a strategic decision of the first degree. He saw satellites here and heard that a week ago we launched a satellite. He was interested in cooperating on satellites," said Ben Hanan.

He stressed to company heads the importance of reciprocal purchases. "Pratt and Whitney, for example, supplies most of the engines for air force fighter jets. I think it's proper to tell them how our military equipment purchases are influenced by cooperation with Israeli industries, and how Israel Aircraft Industries or Bet Shemesh Engines can operate as their subcontractors in competitive fashion," he said. He cited as an example Boeing CEO Jim Albaugh, who immediately met with Israel Air Force executives after sitting with Ben Hanan, which illustrates the give-and-take relationship in the business.

Export Institute chair David Arzi said that Israeli companies signed $800 million worth of deals during the show. Details of some of the deals will be announced in the coming days.

One of them is the deal between Elbit Systems and an Italian firm to continue developing defense systems for airplanes against shoulder-fired missiles. The Italian company will collaborate in the completion of development and bolster marketing in Europe for the system being developed by its subsidiary, Electro-Optics Elop, which was selected to supply defense systems to El Al.

The Israeli companies are concentrated in one section of the show after years when IAI was separated from the other firms. Hundreds of companies show their wares from screws, displayed like precious jewels, to airplane parts. Companies not only compete over products but also pavilion designs.

One of the surprise booths is that of the Emirate of Dubai. It has no security, air, or space industry, but it has an airport to promote. Its exhibit includes photographs showing takeoffs and landings on a plasma screen.

The largest pavilion belongs to the Airbus A380, which was the star of the air show two years ago. It now includes a scaled-down version of the original and of its big sibling, the A350. Two years ago a full-size section of the world's largest passenger jet was displayed, but production problems that set back its delivery schedule led to cancelations. Despite lowering its profile at this year's show, visitors yesterday were busy photographing the A380 exhibit