Tuesday, July 11, 2006

Defense Titans Seek New Israeli Sales

By Jonathan Karp
Wall Street Journal
July 11, 2006

U.S. military contractors are angling to seize a potential new market as Israel considers fielding urban defenses to counter a surge of rocket attacks by Palestinian militants in the Gaza Strip.

Northrop Grumman Corp. recently has held talks with the Israeli government about a laser-based defense, hoping for a breakthrough sale for a system Northrop says has proven itself in tests but which the U.S. Defense Department decided not to deploy. Raytheon Co. has been discussing with Israel a rapid-fire gun system that the U.S. Army is using in Iraq to protect against artillery and mortar attacks.

For years, Hamas Islamist militants have fired crude, short-range "Qassam" rockets into southern Israel, primarily causing property damage. But a resurgence of attacks since Israel withdrew from Gaza last year has created political pressure to respond and is prompting the military to aggressively seek new technologies for a so-called active defense against the rocket threat.

Northrop executives have pitched a laser system in meetings with Israeli officials, including Defense Minister Amir Peretz, who hails from a southern Israeli town frequently targeted by Qassam attacks. "We're exploring a possible deal," said Dan Wildt, Northrop's director of business development for directed-energy weapons, who took part in the talks. Based on Israel's expression of interest in the laser technology, he said, Northrop has begun the process of applying for an export license.

Northrop's solution, dubbed Skyguard, is based on technology it developed with $400 million of U.S. and Israeli funding. Radar identifies an incoming threat, then a high-energy laser fires at the missile, heating the warhead until it detonates in flight. In U.S. Army field tests between 2000 and 2004, Northrop's laser consistently destroyed rockets, artillery shells and mortars. But funding was discontinued last year when the Defense Department decided to pursue smaller, more-mobile laser technologies.

Mr. Wildt says Northrop since has cut the laser system to a fourth the size of the test model, allowing it to fit onto a truck. Skyguard can shoot down a rocket as far as six miles away, he said. For the U.S., an initial Skyguard unit would cost $150 million and take 18 months to build, he said, but the price and schedule for Israel would depend on negotiations once an export license is granted.

Raytheon's potential solution is radically different. Called Phalanx, it is an advanced gun that fires as many as 4,500 rounds of ammunition a minute after radar locks onto an incoming threat. Originally developed for the U.S. Navy, Phalanx has been modified for land use. Six batteries currently are deployed in Iraq, said John Eagles, a spokesman for Raytheon's missile unit. He declined to comment on what industry officials described as contacts between Raytheon and Israel about potential field trials to test defenses against short-range rockets.

Raytheon and Boeing Co. are working on separate programs with Israel to develop defenses against longer-range missiles.

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