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Elbit Wins Brazilian Armored Vehicle Contract

by: Matthew Potter
January 6, 2011

Category: Brazil, Business Line, Companies, Contract Additions, Contract Awards, Countries, Elbit Systems, Events, Israel, production program, Services | RSS 2.0

The near term plans of many defense contractors is to expand their overseas sales as a potential way to offset declines in domestic business. They will do this with the support of their governments who want to maintain an industrial base, decrease their defense costs and keep their economy going. In the past countries would either turn to the United States or Soviet Russia for the bulk of their buys as these countries offered equipment and support on good terms as part of their foriegn policy.

Now though the world’s defense industry has expanded greatly and there are now many available sources of weapons and equipment. This is of benefit to customers as it offers greater competition which should keep prices down as well as a greater variety of choice in what they may buy.

Israel for example has greatly expanded their presence on the world’s defense market with sales to countries such as India, Turkey and in Africa. One company that has taken advantage of Israel’s push for this market is Elbit Systems (ESLT) which has expanded in the U.S., European and South American markets through the sale of electronics and Unmanned Aerial Vehicles (UAV).

In a recent win announced by the company Brazil ordered armored vehicle turrets from the company armed with thirty millimeter cannons. This follow on contract is worth about $260 million. These turrets will be installed on existing Iveco manufactured armored vehicles.

One of Elbit’s core businesses is electronics such as data links and displays. To further their penetration of Brazil and the South American market it acquired companies in Brazil that develop and make electronics. Elbit has also done the same in the United States allowing it greater access to the U.S. Defense Department.

As the world’s defense spending shifts to markets outside the U.S. and Europe Elbit may find itself well positioned to win more contracts like this. It also is in good shape to grow its business in Brazil who are planning a major update to their armed forces over the next several years.

Photo from Ingy The Wingy’s Flickr Photostream.

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