European pathway to space, companies, perspectives and future.

© CNES/ESA/Arianespace/Optique Vidéo CSG/P Baudon, 2019

The last four months were marked by several important events in the European aerospace sector. The first one was that the European Space Agency awarded three German launch startups €500k each under its Boost! Program in November 2020. The lucky ones are HyImpulse Technologies, Rocket Factory Augsburg, and Isar Aerospace. The second one was that EU Commissioner Thierry Breton launched the “European Launcher Alliance” and the €1B European Cassini space fund in January 2021, “to boost start-ups and space innovation”. That sounds impressive and indicates Europe’s serious intentions to cope with the growing challenges in the space industry.

The companies have a lot of ambitious plans. But let’s give some details about what they want to do.

HyImpulse is developing a three-stage rocket capable of sending 500 kg of payloads to LEO. A distinctive feature of the company is the use of hybrid engines. That, from one point of view, may be an innovative solution, but from another, they have a real chance to bring together all disadvantages of both technologies. Einstein’s famous quotation “Everything should be made as simple as possible, but no simpler” is not about this case. Anyway, we will be able to judge the effectiveness of such an interesting decision only by the result. HyImpulse hopes to produce eight launches a year by 2024 and increase that to a double-digit number in the long-run. The cost of one launch is expected to be €10m. The debut launch is scheduled for 2022.

Rocket Factory Augsburg (RFA), a subsidiary of the OHB Group through MT Aerospace, is a small rockets developer. OHB wants to go beyond the achievements in satellites and rocket parts production and create its own small launcher for delivering payloads to orbit. Fortunately, the $1B revenue of the OHB Group in 2019 and the already established production of components for Ariane 5 and 6 make it easier to start.

RFA is going to manufacture small rockets and deliver between 200 and 500 kg of payload. RFA One, with a capacity of 1500 kg, is scheduled for a maiden flight from Andøya Spaceport. Two leading companies are already successfully doing this: New Zealand Rocket Lab, since 2018, and SpaceX, since 2010. Rocket Lab, with its Electron launcher, can deliver 150kg of payload for a price of ~$6m. SpaceX can propose the starting price of $1m for a payload up to 200 kg with an additional $5000 per kg beyond that. Rocket Factory decided to get recognition on the global market by making a lot of rockets, starting production with one per month and gradually increasing capacity. They will attempt to gain 20 to 30 take-offs per year in the initial phase, increasing the number of launches to 50 by 2030. They also want to achieve a price of $3m per launch. For a young startup, founded in 2018, it is quite ambitious even though it has strong support from OHB Group.

They are planning to make the maiden flight in 2022 and have already conducted successful tests of the main components, systems and main engine at the Esrange test site. The company’s success was spotted by the Portuguese Space Agency and now RFA Portugal, a subsidiary of Rocket Factory has received their support.

Isar Aerospace is also planning its maiden flight in early 2022. They are planning to build the rockets far cheaper than today’s market can propose with a payload volume of around 1000 kg. Lighter fuel and a different, simplified approach to the design will help reduce the production cost from the current $40k – $30k to ~$10k per kg. They are planning to build fewer rockets than RFA, around 20 per year. The company has already racked up $500m in customer inquiries. That is certainly good, but not a guarantee of a contract, so we will keep an eye on what is happening.

To fully understand perspectives of the European space market and young launcher start-ups, we’ve asked the CEO of SpaceWatch.Global, Mr. Torsten Kriening, as an expert, to comment on the situation. We want to thank him for finding the time for this discussion.

Sergii Kenzorov:

What is your opinion on the European space market? We are seeing a lot of interest in private companies and young startups, perhaps Ariane is no longer meeting the needs of clients?

Torsten Kriening:

I can’t agree with all your statements. If we consider the launcher market, Europe has its own access to space via Ariane and Vega. These launch vehicles will continue to develop, for Ariane 6, for example, the budget and financing are already allocated for the entire project. Ariane 6 should be attractive on the international market but – and here I agree with you – risks to lose its position to SpaceX. On the other side, I don’t see serious competition from China right now, mainly because of export controls. Russia is still a partner with Soyuz and Proton rockets, but you know better than me the state of the Russian launchers.

What we can definitely see now is the worldwide growth of the small launcher market and the ambitions of young startups. But the main question is what stage are they at? For now, only Rocket Lab has demonstrated its capabilities to go to the market. The young companies are making their claims, but in reality, they are still outside, at the moment. Yes, they have a number of interesting technologies and solutions, but before the first launch, this does not mean a lot.

In general, Europe needs independent access to space to protect national security and avoid export control regulations.

Sergii Kenzorov:

How do you assess the chances of these companies for success?

Torsten Kriening:

When we talk about the launcher market, we should mention the recent initiative by Thierry Breton, who established the “European Launcher Alliance”. This is an interesting attempt to unite the European market. But when we look at the amount of financing that the governments allocate to young companies – several millions, compared to 4 billion Euros for Ariane – the situation looks like David and Goliath. Also, the payload that a company can deliver matters. Here in Europe, we have no companies comparable to Blue Origin and SpaceX in terms of payload. No one is even close to that volume. For instance, Isar Aerospace is planning to deliver 1000 kg. Can they become an attractive alternative for American clients where Firefly and Astra launches already exist?

But the biggest question is related to the ability of the European countries to create sufficient potential and demand to satisfy the ambitions of the young companies. Another important question is whether they will be able to reach the launch stage. We have frameworks like the outer space treaty and regional space laws. But when we talk about Germany, in terms of launchers, the situation is just comic. They’ve inspired the whole market, these young developers are living their dream. These people wanted to fly to the Moon, but Germany didn’t even come close to realizing that, in the meaning of space laws and regulation of this question. Take, for example, Isar Aerospace; they’re conducting negotiations about the test pads in Kiruna, Sweden, and Andøya Spaceport in Norway. You probably saw the German initiative around the sea platform to launch rockets. I’m pretty skeptical about this as well. How do I see this market? I have doubts that they will succeed. Potential is there, technology is there and I’m super convinced that guys like Skyrora, Isar Aerospace will make it. Rocket Factory – definitely, OHB and MT Aerospace are behind them.

Sergii Kenzorov:

You mentioned that European companies can’t achieve the same capacity as SpaceX or Rocket Lab, but maybe they don’t need it. Starting from something small and gradually increasing the power, modify the technology and lift up more massive objects.

Torsten Kriening:

Yes, but will we see the need for it? The crunch point when the companies are able to increase the payload capacity will be there sooner rather than later. We are talking about both aerospace traffic management and space situational awareness. That is what we should take into consideration. I have real doubts that we will see all of them. The next question is where to fly from and at which frequency. A few years back, I had a chance to interview Peter Beck (CEO of Rocket Lab) and he told me about ideas for flying monthly and even weekly. But in later talks, he marked that they had two major launchpads, in the USA and New Zealand, with a capacity of one hundred flights per year and they are fine with that. Honestly, that is more than enough, the European launchers are not even close to that frequency. It remains rocket science, and we have seen the mistakes which can happen, with Vega, for example. If failure happens that means that no flights will take place in the next few months or even years, due to the investigations. For a young company that can be a catastrophe.

My concern is that we are already at the crunch point, we have to decide. Are we polluting our night sky even further? I agree that Elon Musk is doing that right now, with or without us. I think we will be quite soon at the point that we have to recognize it is too late. We are facing similar problems with plastic in the oceans that we can’t handle. I talked in my “Space Cafe” with Elodie Viau, the head of the telecommunications directorate at the European Space Agency (ESA). She said they now have the Clean Space initiative and ESA will devote increasing attention to the environmental impact. Every year hundreds or thousands of satellites launch into space. In the end, does it make sense to have all these launchers on the market and all these satellites in space?

Sergii Kenzorov:

Each country wants to have their own launchers and develop their own space program. But is the world space race really needed and does it contribute to human development or is it more about Earth and space pollution?

Torsten Kriening:

The sustainability regulations for space state that you have to remove a non-operating satellite. But 25 years are too long. If we are to solve this kind of issue, we have to find a way to create new and suitable regulations. Otherwise, space remains a no man’s land. When Elon Musk flies to Mars, will he take our legal system with him? These are very bothering questions. When I was involved with the Open Lunar Foundation and the Moon Dialogs, we were talking about government and governance systems for the Moon. When we look at Artemis, I’m not sure we are there. Artemis gets things moving, that’s good, but some fear that it could violate UN regulations. The US seems to say that “everybody can join us – as long as they follow our rules”. Will Russia or China ever be a partner in Artemis? I have doubts.

Sergii Kenzorov:

Let’s return to our discussion about the Rocket Factory Augsburg. They want to produce about 52 rockets per year and I think that is way too much even if those are just plans. Will the market need such a large amount of rockets to deliver small payloads?

Torsten Kriening:

52 rockets per year is very ambitious. I want to see them launch one. Elon Musk launched 28 rockets last year, if I’m not mistaken, and China launched 34. That is what leading countries with infinite budgets are doing. In terms of Rocket Factory Augsburg, I see several factors that are absolutely crucial, when you want to come even close to that. The first issue is the manufacturing capacity. I know Jörn Spurmann and Stefan Brieschenk, I’ve had interesting chats with them. They come from a mass production and automatization point of view, good German engineering, the car production side, I understand that. But I remain doubtful that this can be achieved. The second point is: where is the demand? OHB, their mother company, has agreed a handful for 4-5-6 launches for them, I think. They thus have the financing and business support to get their technologies proven. The third point is the launchpad. Where in Europe do you have the chance to fly 50 rockets per year? The UK Space Agency approved for 12 launches a year from the Sutherland spaceport. The spaceport has agreements with Orbex and Skyrora. Andøya, where Rocket Factor wants to make their maiden flight and where they are building a launchpad, also has limited capacity. It would be rational to say “Ok, let’s look at a spaceport in the North Sea”, which I also see skeptical. Give it a few years to go full swing, and then show that they can deliver as promised.

Sergii Kenzorov:

Any reasons why European customers should prefer their own companies to well known ones, like SpaceX?

Torsten Kriening:

Multiple layers will play a role here. First of all, you have to drive the prices in a commercial logic, this is key because the price affects how you can sell payloads to your customers. No doubt, there is global competition, the pressure is on. The second element is the export/import regulations – a very important topic. That’s only one reason why we see only a few launches of European payloads in China. The last US president completely blocked the market. Politics and export control play a crucial role because if I ship my satellite from Germany to France, there is no export regime, for example. But there is an issue when it comes to launching, for instance, from Russia. The third layer is about technological autonomy and sovereignty. If a European Space Agency funds the project, would they want to see the launch taking place somewhere else? Industrial return and legitimate policy questions play a role here. I think we are far away from having a single and unified space market, independent from government support and interests.

Conclusion: The booming growth of the space market attracts a lot of enthusiasts worldwide and in recent years we saw an increase in the number of space startups. One reason is just a financial one – global satellite manufacturing and launch markets are expected to grow to $478 B over the next decade. Another one is the diversification of possible risks in line with their space development strategies – countries are moving towards local launchers, satellite and rocket manufacturers.

The perspectives are promising, but the risks are also considerable. And it seems that not many project leaders fully price them in in their own business strategy. From where do we launch all the rockets we want to produce? The existing launchpads have limited capacity. Will there be demand for all these launches in the highly competitive market? Beyond that, the global and fundamental questions about space traffic and space and Earth pollution today remain without clear answers.

Written by Sergii Kenzorov.

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