Israeli Engine Plant in Receivership

The Ministerial Economic Committee voted Tuesday to place the debt-ridden Beit Shemesh engine plant in receivership. The factory employs 340 residents of the development town of Beit Shemesh, and unless Israel Aviation Industries (IAI) agrees to take it over, the government will have to find them jobs.

The plant manufactures engine components of the Lavi, Israel’s second generation jet fighter plane which IAI will build. According to IAI sources, the components can be manufactured more cheaply at the Pratt and Whitney plants in the U.S.

The Beit Shemesh engine works is $100 million in debt, mainly to the government and commercial banks. It is reported to be losing $2 million a month. If IAI does not come to the rescue, the plant will be closed. In that case, the government will provide incentives to investors to open other manufacturing enterprises in the region to provide jobs for the displaced workers.

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