Israel Aerospace Industries (IAI) intends to become more involved in the civil market, as it looks to boost profitability.
Attempts to lay-off around 1,500 workers have so far failed because of strong union and political opposition, leaving the company seeking another solution to alleviate its poor financial performance.
While IAI is considered a defence aerospace company, its new strategy is to draw on its proven design, development and manufacturing capabilities in the civil market.
Although the volume of passenger-to-freighter conversions in its Bedek division is improving, it is not enough: "We need to use our capabilities to bring [in] more work," a company source says.
IAI is negotiating a potential co-operation with civil aircraft manufacturers as it bids to win parts and assemblies manufacturing work.
One effort, still in its early stages, is a plan to design and manufacture a light business jet to transport six passengers up to 1,500nm (2,780km). IAI refuses to say if a deal is close.
The company makes the Gulfstream G280 and the proposed co-operation would allow IAI to work with other companies on the design and production of non-competing executive aircraft.
In a parallel effort, IAI has initiated more discussions with passenger aircraft manufacturers to try to win more subcontracted work.
The Israeli company was recently selected by Boeing as the supplier for empennage leading edges for its 777X.
In addition, the two companies agreed on the expansion of the existing contract and IAI will continue to manufacture other assemblies for the 777 family.