The war in Ukraine has caused several major NATO nations to increase their defense spending and change their weapons purchasing plans. Germany is considering purchasing the Israeli Arrow 3 ABM (Anti-Ballistic Missile) to defend against Russian ballistic missile attacks. Arrow 3 is comparable to the American THAAD (Terminal High Altitude Area Defense) system. The U.S. financed the research on Arrow 3 and U.S. firms built nearly half the Arrow system components.
Arrow 3 is a two-stage high-speed interceptor able to hit long-range ballistic missiles. Arrow 3 entered service in 2017, complementing and eventually replacing Arrow 2, which entered service in 2009. The original Arrow 1 entered service in 2000 and was then the world’s most advanced ABM system regularly involved in combat. Arrow 1 and 2 have been successfully used in combat while Arrow 3 has been successful in realistic tests against incoming ballistic missile warheads.
Each generation of Arrow used a smaller but more capable interceptor missile and increased system capabilities. That was one reason for the United States long prohibiting Israel from exporting Arrow. That ban was recently lifted, which led to an Azerbaijan order and Germany seriously considering a similar purchase. Azerbaijan, which borders Russia and Iran and is a major customer for Israeli weapons, ordered two batteries of Arrow 3 in 2021 to protect itself from Iranian ballistic missiles.
Germany and Israel have long been purchasing each other’s weapons and cooperating in weapons development. For example, in 2011 Germany agreed to lend Israel a Patriot anti-aircraft system radar so that the radars in Israel's six Patriot batteries could be sent back to the United States for upgrades. At the same time Israel was developing its own Magic Wand (now David's Sling) air and missile defense system as a replacement for Patriot. The David's Sling missiles have a longer range (300 kilometers) and better capabilities. The American manufacturer of Patriot cooperated with an Israeli firm to develop and produce David’s Sling, which entered service in 2017, David's Sling depends on longer range radars to get target location and speed information to the David's Sling launchers. Once launched, the David's Sling Stunner missile is guided to the general location of the incoming rocket, until the Stunner's on-board sensors pick it up, and then home in and destroy the long-range rocket.
Arrow was always meant to be a more capable ABM system than Patriot or American systems like THAAD and Aegis. This has helped American air-defense system manufacturers by providing a source of useful Israeli patents to use for American systems. Germany is a customer for German Spike ATGM (Anti-Tank-Guided-Missiles) and both nations sell each other weapons tech.