I. Tracking
1. The Council on Foreign Relations Releases a Task Force Report Calling on US to Strengthen Space Security
As often already repeated by senior leaders of the US government's space assets, from the Space Force to NASA, the US needs to continue to enhance its asset protection, promote international cooperation, and strengthen its on-orbit security. These statements are echoes of what has been said before as the domain has become a battlefield between the US and China, primarily. However, the CFR, like many others, suggests integrating the private sector more into government strategies. Unfortunately, as seen with many other technologies, there are severe concerns about what role the government should play. Many solutions that the government want developed by the private sector are designed only for a government customer; in the end, the government will most likely not see any beneficial discounts to warfighting capabilities developed by the private sector, since they will be the only customer for such services. We are already seeing this within on-orbit refueling and servicing, a capability that the US government has expressed clear interest in, but also made very clear they do not want to be the only customer for the private sector. CFR's hopes to use private sector investments to support developing US resiliency continues to lean on the idea that there is commercial interest in purchasing defense equipment and capabilities. For now, even if private sector players develop the capabilities, it will be using government funding, meaning the government is still going to be the primary funder for space assets that are meant to be primarily used for defense purposes. For dual use technologies (which many satellites cover), the challenge now lies in the international partnership aspect that the CFR laid out. The current White House is extremely transactional with how much it is willing to share, and for commercial companies that offer services to multiple governments, there are real risks that the White House decides to cut off permissions to share capabilities. We're also seeing allies already deciding to spend the money to lower dependence on US capabilities, removing critical customer dollars from the private sector even more. As a result, it seems that the US government will need to fund much of its space capabilities for the foreseeable future, especially if it continues to alienate the few other partners that could financially support such technologies.
Initial story from: Council on Foreign Relations
2. Two Companies Indicate Layoffs in Different Ways, But for Similar Market Reasons
Boeing has hinted that a few hundred jobs were at risk of being terminated as the Trump White House, in partnership with Elon Musk, continue to review NASA's budget. The jobs would most likely be directly associated with the SLS rocket program, the heavy-lift vehicle meant to take the first NASA astronauts back to the Moon before allowing SpaceX and Blue Origin to provide their own systems. Blue Origin is the other company that has announced layoffs, and confirming that around 1,000 people would be let go. This follows the disappointing launch of its New Glenn rocket, and most likely is a sign that the company's strategy is not financially stable. This could be due to a combination of factors, including the fact that the space market is not growing as fast as perhaps was expected, that demand for a heavy-lift rocket is not necessarily going to be there (see our article about the challenges facing heavy-lift). It could also be tied to other political realities that Jeff Bezos faces with Donald Trump and Elon Musk at the White House, although that veers off into the realm of speculation.
While Boeing has given this hint ahead of time to employees, unsurprised by the politicking in Washington DC and other events at the company, Blue Origin's announcement was sudden. Boeing is currently 'warning hundreds' of its employees, but Blue Origin's layoffs will most likely affect around 1,000 employees. This is all the more spectacular because the company has practically no profits, almost entirely bankrolled by Jeff Bezos (New Sheppard may provide some profits, and Blue Engines sold to ULA surely add to the top-line, but certainly not sufficiently to sustain the company). Adding insult to injury to the Blue Origin employees, the company went on a hiring spree in 2022 and early 2023, nearly doubling its workforce, only to start cutting a year or so later, following the New Glenn launch. While some anticipated this was supposed to happen six months ago, there was still hope that Blue Origin's New Glenn would succeed and save some jobs. This has not been the case. Boeing is by no means a shining star in all this, but its troubles on the airline and Starliner sections, alongside rumors that the company was thinking of shedding its space division, mean that the company's announcement is not surprising. And unlike Blue Origin, the company is a real business that must consider actual profits and management strategies to compete and survive.
As these two companies move forward, they are perhaps canaries that signal the rest of the US industry that the dream of 'millions of people living and working in space' is still further away than what was hoped. They join the European Thales and Airbus-labelled warnings that were presented last year, although the European players have apparently started to recover and secured more and more contracts recently.
Initial story from: Space News
II. Immediate Awareness
1 The ESA is advancing on its LEO Cargo Return Service initiative, seeking additional bidders to develop spacecraft for cargo transport to and from low Earth orbit, supporting the development of the infrastructure critical for sustained use of the domain.
2 Space Norway has ordered the THOR 8 communications satellite from Thales Alenia Space to enhance connectivity across Europe, the Middle East, and Africa, with a launch scheduled for 2027, in continued good news for Thales.
3 Elements of the billion-dollar British government's ISTARI constellation have been contracted to Airbus by the UK, cementing further critical contracts to European primes.
4 Safran's India division anticipates a 70% increase in revenue in 2025 due to its involvement in India's Gaganyaan human spaceflight mission and rising private-sector contracts, opening up new markets for existing major players.
5 Spire is suing Belgian Kpler to compel the completion of a $241 million acquisition of its maritime business, with Sprie indicating a sense of urgency was needed because of its need for cashflows..
6 Following the path of many other young space companies, York Space is making a more profound pivot to attract government contracts, working toward offering complete solutions by integrating vertically, a risky proposition that could have large payoffs if it succeeds.
III. Quote of the Week
"Lots of customers are putting a lot of importance also to have non-U.S., non-Chinese alternatives."
Eva Berneke, Eutelsat CEO, as the company continues to build-out the only meaningful LEO constellation competing with Starlink, while also operating 35 GEO satellites.