**Washington**: During the Satellite 2025 conference, European satellite manufacturers expressed urgent concerns regarding competition with SpaceX. Calls for improved collaboration and co-engineering emerged as strategies to counter challenges posed by SpaceX’s low-cost, vertical integration model, prompting discussions of potential industry consolidation.
At the Satellite 2025 conference held in Washington on March 12, key figures from two European satellite manufacturing companies expressed urgent concerns about the need for collaboration within the industry to better compete against major players like SpaceX. Benoit Deper, the CEO and founder of Aerospacelab, emphasised the necessity of breaking through existing barriers and enhancing teamwork among companies. “We have to break some barriers and work more as a team by openly merging or forming joint ventures to share the risk,” Deper stated. He pointed to the consequences of the current siloed approach, warning that it had previously led to the collapse of the launch ecosystem.
SpaceX has established a commanding presence in the global launch market by offering frequent and low-cost access to orbit, primarily through its rideshare flights. This has raised concerns among satellite manufacturers who fear losing market share unless they adapt and innovate effectively. Hervé Derrey, CEO of Thales Alenia Space, echoed this sentiment, declaring that to compete in an environment dominated by vertically integrated entities like SpaceX, the industry must engage in co-engineering efforts between operators and suppliers. “This is not possible through classical vendor-supplier-customer relationships,” he remarked.
The rapid production of communication satellites has allowed SpaceX to build its Starlink constellation, which now contains approximately 7,000 operational satellites in low-Earth orbit. This extensive deployment enables SpaceX to deliver high-tech spacecraft to government clients swiftly and at competitive prices. Notably, the U.S. Defense Department has purchased over 100 Starshield satellites—a military variant of Starlink known for its enhanced security features.
Deper asserted that SpaceX’s “extreme vertical integration” poses significant challenges to individual satellite manufacturers aiming to enhance their competitiveness. However, anticipation of consolidation within the satellite manufacturing sector is rising, with companies like Airbus reportedly in discussions with Thales Alenia Space and Leonardo about integrating their satellite businesses.
In response to ongoing supply chain issues, satellite manufacturers are placing a renewed emphasis on their relationships with suppliers. Debra Facktor, head of Space Systems for Airbus U.S. Space and Defense, highlighted the importance of collaboration with suppliers, stating, “Having good relationships with your suppliers is so important. We’re relying on them to do what they do best and to invest in their technologies.”
As satellite manufacturers scrutinise supplier capabilities to scale production effectively, they are adjusting their criteria for selection. Mike Greenley, CEO of MDA Space, noted, “Good quality, good price and the ability to scale is now the new criteria when you’re picking suppliers.” He indicated that companies are increasingly faced with the option of either investing in suppliers to ensure scalability or bringing aspects of production in-house due to supplier limitations.
The evolving landscape of satellite manufacturing and the competitive pressures exerted by giants like SpaceX illustrate a pivotal moment for European manufacturers as they contemplate their strategies moving forward.
Source: Noah Wire Services
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