Israel Approves Plan to Purchase F-35 and F-15IA Fighter Jets from Lockheed Martin and Boeing

Israel has given final approval for a plan to purchase two new combat squadrons of F-35 and F-15IA advanced fighter aircraft from Lockheed Martin (LMT) and Boeing (BA) in a deal worth tens of billions of dollars, the defence ministry announced on Sunday.

The deal, approved by Israel's Ministerial Committee on Procurement, is the first step in a 350 billion shekel ($119 billion) plan to bolster Israel's military and "strengthen readiness ahead of a demanding decade for Israeli security," the ministry said.

Under the agreement, Israel would buy a fourth F-35 squadron from Lockheed Martin and a second squadron of F-15IA fighter jets from Boeing. The new squadrons will serve as a cornerstone of the military's long-term force development, addressing regional threats and preserving Israel's strategic air superiority.

Domestic Munitions Production

Prime Minister Benjamin Netanyahu said much of this expanded defence budget will be used to produce munitions within Israel, reducing dependence on foreign countries. Israel, he noted, will also develop "groundbreaking" aircraft.

"Israel is stronger than ever, and Israel must always be much stronger than our enemies," Netanyahu said. "These aircraft strengthen Israel's overwhelming air superiority."

Strategic Context

The recent war with Iran "reinforced just how critical the US-Israel strategic relationship is, and how essential advanced air power remains," said Ministry Director General Amir Baram, referring to the Israel Defense Forces.

The United States and Israel launched airstrikes on Iran on 28 February, but a ceasefire has been in place since 8 April. The US Navy continues to maintain a blockade of Iranian ports. Defence Minister Israel Katz said the Iranian conflict demonstrated the air force's power and its decisive role in protecting Israel.

"The lessons of that campaign require us to keep pressing forward on force buildup, to ensure air superiority for decades to come," he said.

Next Steps

Baram said the next step would be to finalise agreements with the US government and military counterparts. In December, Boeing was awarded an $8.6 billion contract for Israel, including 25 new F-15IAs with an option for 25 more.

Katz added that the new aircraft would lead to a significant technological leap in integrating autonomous flight capabilities, next-generation defence systems, and establishing Israeli military dominance in space.

"Our mission is clear: to ensure the IDF has the tools, capabilities, and strength to operate anywhere, at any time," Katz said. "We will continue to invest, to grow stronger, and to stay ahead of our enemies — to keep Israel secure today and in the future."

Market Sentiment: 

The sentiment is positive for Lockheed Martin and Boeing, representing a significant multi-billion dollar order that provides long-term revenue visibility. The deal, part of a $119 billion broader military buildup, underscores Israel's commitment to maintaining a qualitative military edge in the region, particularly following the recent conflict with Iran. For Lockheed, the fourth F-35 squadron adds to a growing backlog for the fifth-generation fighter. For Boeing, the F-15IA order follows the December 2025 contract and includes options for additional jets, providing production line stability. The emphasis on domestic munitions production suggests Israel is also investing in its own defence industrial base, but the aircraft procurement remains firmly with US prime contractors. The deal's approval signals continued strong US-Israel defence cooperation despite recent geopolitical tensions. The market will watch for final contract signings and delivery timelines. Overall, a significant and expected win for both US defence primes, reinforcing their strategic importance to a key ally.

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